Soybean futures experienced an uptick, nearing $10.3 per bushel, fueled by anticipations of a renewed surge in US purchases by China. This expectation is tied to a prospective meeting between President Trump and President Xi. The increased activity from China also bolsters the demand for feed and crush, further supporting prices. Over the weekend, President Trump emphasized the significance of soybeans in trade negotiations and expressed a desire to reinstate purchases, prompting market participants to predict imminent demand from China. Concurrently, China's third-quarter GDP figures exceeded expectations on a quarterly basis, highlighting sustained demand for soymeal in industrial and livestock sectors despite a deceleration in annual growth.
In contrast, progress in the US soybean harvest remains inconsistent. The recent government shutdown has caused gaps in USDA reporting, forcing traders to rely on private surveys, which indicate slower delivery rates. Although South American supplies have met immediate demands, they have not diminished the likelihood of a swift return to US-origin soybeans. Additionally, historically robust US crush rates and favorable crush margins have continued to direct grain towards processing facilities.
