The U.S. soybean production is poised to set a record, with ongoing weather uncertainties and the largest buyer yet to return, alongside the start of South American planting. Amid this mix of bullish and bearish factors, U.S. soybeans face both upward pressure and downside support. The recently released September U.S. Department of Agriculture (USDA) supply and demand report has failed to provide upward momentum for soybeans. After more than a year of consolidation, the question remains: when will U.S. soybeans break out?
The chart shows the daily candlestick patterns for the continuous front-month contract of CBOT soybean futures.
The so-called "weather market" remains calm, leaving the short-term direction for soybeans uncertain. Typically, July and August are periods of intense trading on weather developments affecting agricultural commodities in U.S. markets, but this year major North American crop areas have experienced favorable weather, resulting in relatively calm CBOT agricultural futures markets.
About a month ago, the USDA's monthly report unexpectedly lowered its forecasts for U.S. soybean production and inventories, providing crucial support for soybeans to reclaim the 1000 cents per bushel level. However, in the September report, the USDA revised the 2025/26 soybean planted acreage, production, crush volume, and ending stocks upward to varying degrees, but lowered the yield and export expectations, making the overall report neutral to slightly bearish.
Nonetheless, the report did not exert significant pressure on the soybean market. After a brief decline following the report’s release, soybean prices rebounded and stabilized. Besides the expected bearish tone and anticipation of China's potential return to buying, the expanded drought areas across the U.S. Midwest since September and the decline in soybean crop condition ratings introduced renewed uncertainty.
According to the USDA’s weekly crop report, soybean condition ratings dropped further to 64% good-to-excellent as of the week ending September 7, after already declining 4 percentage points the previous week. Market observers note that this decline in crop ratings was not yet reflected in the September supply and demand report’s yield forecasts. Although the predominately dry September weather in many parts of the Midwest favors harvesting mature fields, it is unfavorable to fields still in the flowering and pod-filling stages. There is widespread concern that if substantial rainfall does not occur by mid-to-late September, final yields could be revised downward further.
On a positive note, the latest weather forecast for the week of September 15 indicates that most rainfall will focus on the western Midwest, which could benefit the grain filling and pod development of both soybeans and corn.
In summary, the weather-driven soybean market appears to be nearing its conclusion. While weather factors over the past two months have not stirred much volatility, uncertainties remain for September, leaving short-term soybean price movements unpredictable.
On the demand side, news continues to be volatile, with the movements of the largest buyer remaining a key focus. Both the U.S. biodiesel policy changes and the activity level of this top buyer are critical influencers for soybean demand.
The September supply and demand report’s upward revision of crush volume coupled with a downward revision in exports somewhat reflects the boost to crushing supported by the U.S. biofuel policies and the suppression of exports due to the absence of Chinese buying.
The latest weekly export sales report, for the week ending September 4, showed a net U.S. soybean export sales volume of 541,000 metric tons for the 2025/2026 marketing year, yet sales and shipments to China for that year remain at zero. As the buyer holding 61% of global soybean imports over the past five years, China has increasingly shifted to sourcing soybeans from Brazil. This shift has supported Brazilian soybean premiums and increased planting there, while reducing demand expectations for U.S. soybeans. Analysts note that despite an 11.5% year-on-year export increase in 2024/25 to non-Chinese markets driven by alternative demand, it is still not enough to fundamentally fill the demand gap left by China.
On September 14, China and the U.S. held bilateral discussions in Madrid on economic and trade issues. The unpredictable progress of China-U.S. trade negotiations and shifts in the global soybean trade landscape could exert a significant impact on the future direction of U.S. soybeans.
Additionally, U.S. biodiesel policy supports soybean crush expansion. Thanks to the U.S. Environmental Protection Agency’s substantial increase in the 2026 biodiesel blending mandates, which is expected to raise demand for soybean oil, crushing capacity for soybeans has noticeably increased, and soybean crushing profits have reached the highest level of the year, strengthening crush demand. According to the National Oilseed Processors Association (NOPA), U.S. members crushed a record 195.699 million bushels of soybeans in July 2025, a historical high for that period.
Faced with fundamental factors that contain both bullish and bearish signals, the soybean market currently lacks a clear directional driver. Hence, the price is likely to remain range-bound for the foreseeable future. During this period, mastering market rhythm and managing risks prudently will be essential challenges for participants.
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