Recent Soybean Meal Market Update: Overseas Supply Pressures Weigh on Domestic Prices

International soybean futures trended weaker recently, weighing on China’s domestic soybean meal market. The CBOT November soybean contract moved lower as U.S. soybean harvesting progressed smoothly and expectations of a bumper U.S. crop were gradually realized, bringing continuous farmer selling pressure. Meanwhile, Brazil’s new-crop soybean sowing pace hit a record high for the same period, and ANEC raised its forecast for Brazil’s soybean exports in October, adding supply pressure from South America. Weak Chinese buying interest for U.S. soybeans further limited upward momentum of overseas soybean prices.

In the domestic market, soybean meal prices fluctuated downward amid fading cost support from weaker CBOT soybeans. Oil mills maintained high soybean meal inventories, while downstream feed producers adopted hand-to-mouth purchasing. As of the week ending October 16, the DCE M2701 main soybean meal futures contract closed at CNY 3,281 per tonne, down 3.56% week-on-week. Spot soybean meal in Jiangsu was quoted at CNY 3,250 per tonne, a drop of CNY 80 per tonne from the previous week, with the basis of the front-month contract standing at CNY -72 per tonne.

On the demand side, livestock and poultry breeding sectors continued to suffer losses, restraining feed consumption. Ample domestic soybean arrivals sustained high crushing rates at oil mills, keeping soybean meal supply loose. Looking ahead, soybean meal pricing will remain cost-driven in the short run. Market participants will closely monitor the pace of U.S. new soybean arrivals and Brazil’s sowing progress. Any marginal improvement in U.S. soybean export sales may trigger a rebound in both overseas soybean and domestic soybean meal prices.