Multiple "news" came, and the price of soybeans fell sharply on the surface, but in fact there was "a lot of drama"! What's going on?

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While everyone was collecting wheat and corn, the soybean market experienced great fluctuations.

Generally speaking, the sudden sharp drop in international soybean prices has led to a decline in domestic soybeans. With the continuous domestic soybean auctions, the domestic soybean market trend is confusing.

So, what happened?

1. The U.S. soybeans fell.

The U.S. soybeans fell, which is a relatively strong signal.

Because the current global soybean focus is on U.S. soybeans. On the one hand, domestic soybean dependence has been as high as over 80%. On the other hand, it has basically become a fact that South American soybean production has been reduced due to severe drought weather. , Brazil, Argentina, etc. have all lowered their soybean production expectations. Even Paraguay, the world's fourth largest soybean producer, has reduced its production by half and has begun to import soybeans from other countries.

So, the world’s soybeans are concentrated on American soybeans.

However, at this moment, the United States announced an investigative report that exploded.

According to the report, due to the high price of chemical fertilizers, American farmers have been overwhelmed and are more inclined to plant soybeans than corn. Generally speaking, soybeans require only about half the amount of chemical fertilizers used in corn and wheat.

In this case, American farmers are more inclined to plant soybeans.

The report shows that the soybean planting area in the United States in 2022 will be 90.955 million acres, higher than the previous market expectation of 88.727 million acres.

The U.S. soybean quarterly inventory was 1.931 billion bushels, which was also higher than the previous market expectation of 1.901 billion bushels.

As a result, the price of U.S. soybeans plummeted.

2. Weather interference

However, it is obvious that the market rarely experiences unilateral trends.

Amidst the negative news about the increase in soybean planting area in the United States, another piece of news has made the trend of soybeans confusing.

According to the National Oceanic and Atmospheric Administration’s weather forecast for the country from April to June, drought and high temperatures may occur at the same time.

This means that the growth of soybeans will be threatened, which will undoubtedly become an excellent subject for weather speculation in the future.

This also laid the foundation for soybeans to be weak near and strong far away.

3. Increased supply

Generally speaking, our grain market is relatively independent, so it is not significantly affected by international grain prices, but soybeans are an exception.

While the international soybean market is in turmoil, domestic soybeans are also experiencing major fluctuations.

Recently, domestic soybeans have been falling continuously, which has also cast a veil over the trend of domestic soybeans.

One of the first reasons for the decline in domestic soybeans is that the market is worried about the huge amount of soybeans arriving in Hong Kong from April to May, so they have sold off spot goods. Coupled with the continued auction of policy soybeans, the supply of soybeans has also been short-term. increased, soybean prices fell.

On the other hand, under this year's "bean expansion" policy, the sown area of ​​soybeans has increased substantially, which has also exacerbated the shadow of the increase in soybean supply and the inability to rise in soybean prices.

Although on the surface, soybeans are more negative, the New Agricultural Outlook does not believe that the trend of soybeans is over, and soybeans still have a strong upward momentum.

First, although it is true that soybean planting area has increased, the yield per mu of soybeans is quite different from that of corn. Usually farmers will use better land to plant corn, and relatively cheap land is used for planting. Soybeans.

Although the planting area has increased, you must know that this is based on the decline in soybean planting area and output last year. In addition, the safety of the three major staple foods must be ensured, so it is not The yield of staple crops will be sacrificed in order to grow soybeans.

This means that the increase in soybean production is relatively limited.

Second, from a global perspective, the supply of soybeans remains tight.

Although the US soybean planting area has threatened to increase, it is still early April, so it is still too early to judge this, and subsequent changes cannot be ruled out.

And more importantly, with current high oil prices, demand for biofuels in the United States is still strong.

Data show that in 2021-2022, the total amount of soybean oil used to produce biodiesel in the United States was 4.85 million tons, a year-on-year increase of 21%, accounting for approximately 41% of the total soybean oil production in the United States.

This also means that under the strong demand for biofuels, the subsequent trend of U.S. soybeans will obviously not be a one-sided situation, but is destined to make waves again.

Therefore, the soybean "turmoil" has obviously not really started yet. In addition, with spring sowing just around the corner, the impact of subsidies on farmers' crops is actually limited, and more importantly, it is more affected by prices. Therefore, in the overall growth Under the tone of expanding beans, it is difficult for bean prices to fall sharply.

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