WASDE Report Lowers U.S. Soybean Yield Forecasts, Boosting Oilseed Markets
WASDE Report Lowers U.S. Soybean Yield Forecasts, Boosting Oilseed Markets
Hamburg, November 8 – The latest USDA WASDE report surprised markets with a significant cut in U.S. soybean yield projections, pushing up oilseed prices globally. Analysts also foresee high palm oil prices extending into 2025.
Rapeseed futures on Euronext rose for the third consecutive day on Friday, reaching multi-month highs. The February contract added 3.75 EUR, closing at 536.50 EUR per ton, resulting in a weekly gain of 3.8%. This marks the eighth consecutive week of gains. Soybeans on the Chicago Board of Trade (CBoT) also closed higher, with the most-traded January contract rising by 4 cents to 1,030.25 ct/bu (353 EUR/t), achieving a weekly gain of 3.7%. Higher soy oil prices supported this increase, although losses in soy meal slightly limited the gains.
Another major factor driving the oilseed markets was Malaysia's rising palm oil prices. Malaysian palm oil futures increased on Friday after positive production and price forecasts for the 2024/2025 season were presented at an industry conference in Bali. The most-traded January contract rose 4.77% last week, reaching 5,100 MYR/t (approximately 1,141 USD/t), the highest level since June 2022. Analysts predict that tight supplies will sustain prices at high levels until mid-2025. Indonesia’s plan to raise the biodiesel mandate from 35% to 40% palm oil next year is expected to require an additional 3 million tons of raw materials, according to the Indonesian Palm Oil Association (GAPKI). Industry analyst Thomas Mielke also forecasts a 2.3 million ton recovery in global palm oil production for the 2024/25 season.
The WASDE report lowered the expected U.S. soybean yield by 1.4 bushels per acre to 51.7 BPA, reducing the harvest by 3.3 million to 121.4 million tons. While projections for South America remained unchanged, global soybean production for 2024/25 is now estimated at 425.4 million tons, down 3.5 million tons from October. Ending stocks were also cut by 2.9 million tons to 131.7 million tons, exceeding even the most pessimistic expectations.
According to the CFTC report, financial investors reduced their net short positions in soybean futures and options by 2,114 contracts to 70,112 for the week ending November 5.
Canola's future on ICE in Canada also hit a three-month high, supported by strong vegetable oil markets. Canadian oil mills processed 240,441 tons of canola last week, pushing total season processing above 3 million tons, surpassing last year’s pace, according to the Canadian Oilseed Processors Association.
Hamburg, November 8 – The latest USDA WASDE report surprised markets with a significant cut in U.S. soybean yield projections, pushing up oilseed prices globally. Analysts also foresee high palm oil prices extending into 2025.
Rapeseed futures on Euronext rose for the third consecutive day on Friday, reaching multi-month highs. The February contract added 3.75 EUR, closing at 536.50 EUR per ton, resulting in a weekly gain of 3.8%. This marks the eighth consecutive week of gains. Soybeans on the Chicago Board of Trade (CBoT) also closed higher, with the most-traded January contract rising by 4 cents to 1,030.25 ct/bu (353 EUR/t), achieving a weekly gain of 3.7%. Higher soy oil prices supported this increase, although losses in soy meal slightly limited the gains.
Another major factor driving the oilseed markets was Malaysia's rising palm oil prices. Malaysian palm oil futures increased on Friday after positive production and price forecasts for the 2024/2025 season were presented at an industry conference in Bali. The most-traded January contract rose 4.77% last week, reaching 5,100 MYR/t (approximately 1,141 USD/t), the highest level since June 2022. Analysts predict that tight supplies will sustain prices at high levels until mid-2025. Indonesia’s plan to raise the biodiesel mandate from 35% to 40% palm oil next year is expected to require an additional 3 million tons of raw materials, according to the Indonesian Palm Oil Association (GAPKI). Industry analyst Thomas Mielke also forecasts a 2.3 million ton recovery in global palm oil production for the 2024/25 season.
The WASDE report lowered the expected U.S. soybean yield by 1.4 bushels per acre to 51.7 BPA, reducing the harvest by 3.3 million to 121.4 million tons. While projections for South America remained unchanged, global soybean production for 2024/25 is now estimated at 425.4 million tons, down 3.5 million tons from October. Ending stocks were also cut by 2.9 million tons to 131.7 million tons, exceeding even the most pessimistic expectations.
According to the CFTC report, financial investors reduced their net short positions in soybean futures and options by 2,114 contracts to 70,112 for the week ending November 5.
Canola's future on ICE in Canada also hit a three-month high, supported by strong vegetable oil markets. Canadian oil mills processed 240,441 tons of canola last week, pushing total season processing above 3 million tons, surpassing last year’s pace, according to the Canadian Oilseed Processors Association.