USA: Lower oil prices and favorable planting weather in Brazil put pressure on soybean complex prices

Soybean

Canola Seed & Rapeseed

United States

Published Sep 28, 2022

Tridge summary

Soybean and oil quotes remain quite volatile amid a downgrade in the U.S. soybean crop forecast and favorable planting conditions in Brazil. However, the acceleration of the recession of the world economy may reduce the demand for products, especially given the high level of prices. Last week on the Chicago Stock Exchange, November soybean futures fell 1.7% to $523.9/t, while soybean oil fell 3.8% to $1,405/t, losing 2.4% for the month and 5% respectively and returning to the "pre-war" level.

Original content

Traders reduced the number of contracts for soybeans and soybean products during the week, not counting on price increases in the near future. Despite the escalation of the war on the part of the Russian Federation, global oil prices accelerated their decline in anticipation of the eighth package of sanctions against Russia, in which the EU may limit the price of Russian oil and disconnect Gazprombank from SWIFT, which is now the main source of foreign currency income for the Russian Federation. Brent crude futures for November fell 6% for the week to an 8-month low of $86/barrel. The growth of the dollar against other world currencies to a 20-year high increases the pressure on energy prices. In addition, they are under pressure from the decline in the last 4 weeks of demand for gasoline in the US to the lowest level since 1997, and for diesel fuel to the lowest level since 2020. According to Flightradar24, the number of flights for the month fell by 5.4% and is 16% below the ...

Source: Agroconf