China has been the big story of the soybean market this year, as is the case most years. The mood of the world's largest soybean importer typically determines the strength of post-harvest rallies, and strong demand this year helped drive prices steadily higher over the last six months.
Chinese buying is beginning to ease, however, with cancellations continuing again in the latest week. But domestic buyers back in the U.S. were reportedly eager to snatch up cancelled loads, a trend confirmed by this morning's monthly crush for May reported by the National Oilseed Processors Association. Spurred by margins approaching $1 a bushel on the Board, there's even been talk lately that the U.S. may turn to imports if supplies run out.
NOPA crush was again below year-ago levels, but the gap narrowed to its closest level of the entire marketing year. That raises the possibility that crush for the year may up as much as 25 million bushels greater than USDA currently forecasts, suggesting even more export cancellations would be needed to keep supplies from running impossibly tight.
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