Soybean Prices Drop Amid EU Tariffs and Supply Concerns

Soybean prices have dipped as tariffs from the EU are set to impact imports. With losses observed in the market, investors should assess how these developments may affect stock prices of related commodities.

Date: 13-03-2025

AI Rating: 4

Current Market Trends: Soybeans have faced significant downward pressure, with prices dropping by 9 to 11 cents. The cash bean price fell to $9.37, reflecting a broader concern in the agricultural commodity market.

Impact of Tariffs: A major factor contributing to these declines is the announcement of retaliatory tariffs by the EU linked to U.S. steel and aluminum tariffs, which will apply to soybeans. While the EU has no soybeans on its books, the U.S. has already shipped 4.5 million metric tons (MMT) to the EU this marketing year. The potential for decreased exports to the EU due to the tariffs may negatively influence future soybean prices.

Export Sales Estimates: Anticipation builds with the USDA's upcoming weekly Export Sales report, projecting soybean sales between 275,000 and 700,000 MT for the 2024/25 marketing year. However, sales for new crops are estimated to be much lower, 0-100,000 MT, indicating potential issues with future demand.

Planting Intentions: Additionally, data from Stats Canada regarding planting intentions shows a decrease in canola acreage and a slight reduction of 1.37% in soybean acreage to an anticipated 5.64 million acres. This reduction in planting may constrain supply further, yet the market reaction indicates bearish sentiment predominantly.

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