Chronicle of raw materials
Energy prices outweigh soybean prices
Audio 01:39
Harvesting soybeans on a farm in Indiana, USA (illustrative image).
REUTERS - Bryan Woolston
By: Marie-Pierre Olphand Follow
2 mins
Soybean prices reached their highest level in ten years at the end of last week.
Everyone wants some, and there may not be enough...
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Since September 2012, soybeans had not reached such levels.
And as often, there are several reasons for this runaway market.
One of the first is the price of oil, which is driving the biofuel industry, especially in North America.
Processors look for soy wherever they can find it, the operation of converting to biodiesel has become very profitable in the current context.
China bought a lot in May
Chinese demand is also one of the essential factors to explain the tension on the market: China is buying record volumes of American soybeans, and as much as it can of Brazilian soybeans.
Chinese soybean imports in May were higher than in 2021 for the same period, despite the confinement of several cities, notably Shanghai.
Proof of the current enthusiasm, exports of Brazilian soybeans, the world's leading producer, are ahead of targets.
And in the United States, the second largest producer, 13 million tonnes over the next campaign have already been sold, which is much more than last year.
Soy is also benefiting from the current livestock feed crisis, according to an economist in the meat sector, Jean-Paul Simier.
In the absence of Ukrainian high-protein sunflower meal and maize, "
Brazilian soybeans are increasingly sought after by breeders as an intermediate solution
," he explains.
With one big advantage, soy has a very high protein content.
“
We are entering a period of risk
”
In recent days, soy has kind of caught up.
“
It had lagged behind and had not experienced a rise similar to that of wheat and corn since the start of the war in Ukraine
,” recalls Nathan Cordier, head of market analysis at Agritel.
According to him, the market should remain very nervous in the coming weeks.
American farmers are planting their soybeans.
At the slightest climatic accident, prices are likely to rise again, because everyone knows that the demand is there opposite.
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