Chinese Demand Drives Soybean Market Volatility as Prices Retreat Mid-Week

Soybean futures extended their downward trajectory heading into the weekend, with losses accelerating across the board. January contracts slipped 16 3/4 cents on Friday alone, bringing the week’s decline to 28 cents. The cmdtyView national average cash bean price settled at $10.06 1/2, representing a 17-cent retreat from prior levels.

Price Action Across the Complex

Soybean meal futures painted a mixed picture, with nearby months climbing 40 cents to $1.80 on the upside, though deferred contracts weakened considerably. January soymeal finished the week down $4.90, signaling profit-taking in near-term positions. Soy oil wasn’t immune to selling pressure, sliding 55 to 83 points lower, with January marking a steeper loss of 162 points for the week.

Chinese Buying Appetite Remains Substantial

Despite softer prices, Chinese importers continued accumulating supplies. The USDA reported a private export sale of 132,000 MT to China this morning, pushing known Chinese purchases to 3.5 MMT when combining daily flash sales and weekly data. This ongoing demand underscores China’s strategy to rebuild strategic reserves even as global prices face headwinds.

In adjacent markets, soymeal demand extended beyond China, with Mexico securing 104,328 MT in reported sales—93,895 MT earmarked for the current marketing year and 10,433 MT for the next cycle.

Speculative Positioning Reaches Milestone

Commitment of Traders data released this week showed spec funds adding 35,182 contracts to their net long position, lifting their aggregate stance to 229,625 contracts net long. This marks the largest speculative long positioning since October 2020, suggesting traders anticipate a stabilization or recovery after recent weakness.

What’s Ahead

The export sales calendar will deliver another backlogged update on Monday. Market participants are penciling in soybean sales ranging from 0.8 to 3 MMT for the week ending November 20. Soymeal sales are estimated between 100,000 and 450,000 MT, while bean oil allocations could hit 5,000 to 25,000 MT.

Adding to the picture, Sinograin—China’s state-controlled stockpiler—has scheduled another auction for 513,000 MT of imported soybeans for next Tuesday, reaffirming Beijing’s intention to secure supplies at competitive levels.

Contract Settlement Summary

Jan 26 Soybeans closed at $10.76 3/4 (-16 3/4 cents), Nearby Cash Bean at $10.06 1/2 (-17 cents), Mar 26 Soybeans at $10.86 3/4 (-16 cents), and May 26 Soybeans at $10.97 (-15 1/4 cents).