Soybeans Close Mostly Higher as Bean Oil Settles Up the Expanded Limit

Soybean futures closed steady to higher, while soymeal futures declined following an EPA announcement. Soybean oil led gains due to continued fallout from expanded Renewable Volume Obligations (RVOs). US soybean planting progress lags the five-year average at 93% complete, and crop conditions declined by 2% to 66% good/excellent. Weekly export inspections were down 61.4% from the previous week and 36.7% year-over-year, though marketing year shipments are up 11.1% from last year. May NOPA crush totaled 192.83 million bushels, a record for the month, but slightly below estimates; soybean oil stocks decreased significantly from last month and last year.

Analysis

Soybean futures exhibited modest gains, with November '25 contracts closing 5 3/4 cents higher at $10.60 1/2, while the cmdtyView Cash Bean price eased by 1/4 cent to $10.20 1/4. The soybean complex is experiencing divergent internal pressures: soybean oil futures surged, closing up by the expanded limit of 450 points, driven by the continued positive impact of expanded Renewable Volume Obligations (RVOs). Conversely, soymeal futures declined sharply by $7.90 to $8.10 per ton, following an EPA announcement perceived as unfavorable for this by-product. On the supply front, U.S. soybean planting reached 93% completion for the week ending Sunday, slightly trailing the 94% five-year average. More significantly, crop conditions unexpectedly deteriorated, with good-to-excellent ratings falling by 2% to 66%, contrary to trader expectations for improvement, and the Brugler500 index reflected this with a 5-point drop to 367. Demand signals present a mixed picture: weekly export inspections for the week of June 12 were notably weak at 215,803 metric tons, a 61.4% decrease from the prior week and 36.7% below the same week last year. However, cumulative marketing year shipments remain robust, up 11.1% year-over-year to 45.416 MMT. The May NOPA crush report indicated a record 192.83 million bushels processed, a 5.01% increase year-over-year and 1.37% above April, though this figure fell short of market estimates. Supporting the oil strength, soybean oil stocks saw a significant drawdown, declining 10.02% from April and 20.34% year-over-year to 1.37 billion gallons.

Key Decisions for Investors

• Investors should monitor the widening spread between soybean oil and soymeal values, as sustained oil strength driven by RVOs may support overall soybean crush margins despite meal weakness.
• Closely track weather developments and upcoming USDA crop progress reports, as current planting lags (93% vs 94% avg) and declining crop conditions (66% gd/ex) pose a risk to new crop supply outlook.
• Evaluate the sustainability of strong crush demand, evidenced by a record NOPA May crush of 192.83 million bushels, against recent weak weekly export inspections (215,803 MT) and the fact that the crush figure missed estimates.
• Prepare for potential increased price volatility in the soybean complex, indicated by expanded trading limits effective Tuesday, and consider adjusting risk management strategies accordingly.