Soybean Futures Extend Slide into February, Pressured by Export Concerns and Harvest Progress
Soybean futures extended their decline as February trading commenced, pressured by a combination of tepid U.S. export demand and progressing harvests in key South American producing nations. Front-month contracts were down 6 to 7 cents, building on Friday's losses of 8 to 10 cents. For the week, the benchmark March contract settled 3 ½ cents lower.
Market structure showed shifting positions, with Friday's open interest rising by 1,392 contracts. Notably, March saw a reduction of 3,705 contracts while May added 3,697, suggesting some roll activity. The national average cash price fell 7.5 cents to $9.98 ½. Soy product markets also softened, with soymeal futures down $2.40 to $3.00 and soy oil futures slipping 52 points on Friday.
Behind the Numbers: The latest CFTC Commitment of Traders report revealed speculators added 7,261 contracts to their net long position in soybean futures and options as of January 27, bringing the total to 17,321 contracts. This speculative buying, however, has been insufficient to counter broader fundamental headwinds.
The primary drag remains export competitiveness. Thursday's USDA Export Sales data showed commitments at 33.85 million metric tons (MMT) as of January 22, lagging 20% behind last year's pace. Current sales represent just 79% of USDA's full-year export estimate, well below the five-year average pace of 87% for this point in the season.
Attention now turns to domestic demand, with the USDA set to release its monthly crush data later today. The market anticipates December's soybean crush reached approximately 230.4 million bushels.
Global Context: In South America, conditions are mixed. The Buenos Aires Grains Exchange reported 47% of Argentina's soybean crop is in good-to-excellent condition. While this marks a significant improvement from the 24% rating in the drought-stricken same week last year, it remains 6 percentage points below last year's level. Meanwhile, in Brazil, consultancy AgRural estimates 10% of the massive soybean crop had been harvested as of last Thursday, keeping pressure on global supply expectations.
Market Reaction: At the close, Mar '26 Soybeans settled at $10.64 ¼ (down 8¢), May '26 at $10.77 (down 8 ¾¢), and Jul '26 at $10.90 ½ (down 9 ¼¢).
Trader Perspectives:
"The export number is the story," said Michael Reed, a veteran analyst with Heartland Commodities. "Until we see a sustained pickup in sales, particularly to China, the market will struggle to find a floor with Brazil's harvest accelerating."
"It's a classic supply-demand shift," noted Sarah Chen, a portfolio manager at Greenacre Capital. "The U.S. had its window, but the focus is rightly turning south. The crush data will be critical to see if domestic use can pick up the slack."
"This is more than just seasonal pressure," argued Frank Dobbs, an independent trader, his tone sharp. "It's a failure of policy and market positioning. The USDA's export target looks increasingly like a fantasy, and funds are just rearranging deck chairs on a sinking ship. Producers are getting squeezed again."
On the date of publication, Austin Schroeder did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com.