Soybean futures prices saw an upward trend during China's Labor Day holiday. The rise was supported by increasing US soybean oil prices, while market concerns over potential production cuts due to El Niño also contributed to tightening supply and pushing prices higher. Currently, US soybean growth progress remains unaffected. Analysts project short-term price stability for US soybeans, with a medium-to-long-term outlook of fluctuating increases. The July contract is expected to approach 1250 cents per bushel in May.
On the supply side, El Niño concerns are growing, but the impact on soybeans remains limited. According to NOAA climate forecasts, the probability of a global El Niño event remains above 70% on a quarterly average from April 2026 onward, with probabilities exceeding 90% from June through year-end. As US soybeans enter a critical growth stage starting in June, climate impacts will primarily affect US production regions. Given that global soybean futures are benchmarked on the Chicago exchange, weather conditions will directly influence US futures and, consequently, global soybean prices.
Although El Niño conditions are developing, US soybean planting continues to progress normally without weather-related disruptions. USDA data shows that as of the week ending May 3, US soybean planting progress reached 33%, up from 23% the previous week, and compares with 28% last year and a five-year average of 23%. Emergence rates stood at 13%, compared to 8% the prior week, 6% last year, and a five-year average of 5%. Current supply-side data does not indicate any signs of reduced production.
In South America, Brazil's soybean harvest progress has reached 95%, with stable production estimates. In May, StoneX raised its forecast for Brazil’s 2025/26 soybean production by 1% to 181.6 million metric tons, citing improved crop yield estimates nationwide and increased planting area projections in Rio Grande do Sul. In Argentina, soybean harvesting progress reached 18.3%, up from 10.2% the previous week. Although progress lags 11 percentage points behind the five-year average, it is nearly 4 percentage points ahead of last year’s pace, with harvesting activities accelerating. As South American production enters the harvest and marketing phase, the influence of weather will gradually diminish, shifting market focus to US growing conditions.
Overall, current data from both South and North America do not reflect any substantial impact from El Niño on soybean production. However, as the probability of El Niño increases from June onward, market prices may begin to factor in weather-related risk premiums. From a supply perspective, current conditions are stable, but expectations are heating up, creating a neutral-to-bullish influence on US soybean futures.
On the demand side, US domestic crushing is rising, while export demand is weakening. USDA’s monthly crush report shows that US soybean processing reached 227.4 million bushels in March, up 13.2 million bushels from the previous month and 20.4 million bushels year-over-year, setting a new record for the period.
Export data, however, shows a declining trend since the beginning of the year. For the week ending April 30, US soybean export inspections totaled 450,100 metric tons, compared with 335,700 metric tons during the same period last year. Cumulative export inspections for the 2025/26 marketing year reached 33.27 million metric tons, down 23.5% year-over-year. The decline in exports is attributed to stronger domestic consumption and increased competition from Brazil’s new-crop supplies, which are pressuring US old-crop sales.
In summary, although El Niño concerns are escalating, current data from both US and South American soybean markets do not yet show any tangible weather-related impacts. On the demand side, strong domestic usage contrasts with weaker export performance, resulting in a structurally neutral influence on prices. Weather-driven risk premiums are expected to continue supporting international soybean prices. Analysts anticipate short-term stability for US soybeans, with medium-to-long-term fluctuations trending upward. The July contract is projected to test the 1250 cents per bushel level in May.
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