Soybean Prices Continue Draining Lower as Chinese Demand Softens

fork_in_the_road · 2025-12-26T04:14:41+00:00

Soybean futures are experiencing modest declines due to waning Chinese demand, with cash prices dropping and open interest declining. Market sentiments are mixed as soybean meal remains steady while oil prices fall. Regulatory uncertainties also contribute to ongoing pressure in the market.

fork_in_the_road

2025-12-26 04:14:41

Abstract generation in progress

Soybean futures kicked off Wednesday’s session with modest declines ranging from fractional to 1.5 cents, continuing a downward pressure that saw contracts close Tuesday down 9 to 10 cents. The rally driven by Chinese buying interest has evaporated entirely, with futures now filling the gaps left on the October chart. Open interest declined by 18,524 contracts, with concentration in the January contract.

Cash Markets Reflect Broad-Based Weakness

The national average cash soybean price dropped 8.75 cents to $9.92, signaling weakness across the entire value chain. Soybean meal futures held relatively steady, sliding just $1.10, while soybean oil bore the brunt of selling pressure with losses of 98 to 112 points. This differential weakness suggests meal demand remains more resilient than oil, though both are leaking ground as overall commodity sentiment deteriorates.

Supply Dynamics and Policy Uncertainty

China’s state stockpilers moved 323,000 metric tons of imported beans on Tuesday, with a substantially larger 550,000 MT auction scheduled for Friday. These sales volumes indicate active domestic management of reserves. Meanwhile, European soybean imports from July through mid-December totaled 5.6 million metric tons, representing a meaningful 14% shortfall against the 6.5 MMT pace recorded in the prior year period—a figure worth monitoring for broader demand implications.

Regulatory clarity remains elusive. The EPA’s confirmation that finalization of 2026 renewable volume obligations won’t occur until Q1 2025 adds another layer of uncertainty to commodity risk management.

Contract Settlement Summary

January 26 futures closed at $10.62 3/4 (down 9 cents, currently off 1.5 cents), while March 26 contracts settled at $10.71 3/4 (down 9.5 cents, currently down 0.75 cents). May 26 futures closed lower at $10.83 (off 10 cents, currently down 0.75 cents). The nearby cash market tracked the January weakness at $9.92, down 8.75 cents.

The combination of exhausted Chinese demand, lighter open interest, and mixed global import trends suggests the near-term pressure could persist until fresh catalysts emerge.

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