Soybean prices backed off an all-time high yesterday. The previous record was set in 2012 during a drought.
Soybeans have received less attention than corn and wheat, but soybean prices have also surged. Soybeans are a significant component in livestock feed, as its oil is used in a variety of packaged foods from salad dressings to baked goods, and as cooking fuel.
Much of the agricultural complex is in the mode of what else could go wrong. Ukraine’s 6.5 tons of sunflower oil has put considerable strain on soybean oil.
Soybean oil prices are near the all-time highs hit in April when Indonesia banned palm oil exports. Indonesia has since removed the ban as it lacks the storage capacity to withhold much of its production. Last week Brazil lowered its projections for its soybean crop from 138.2 million tons last year to 124.3 million tons this year.
With fewer places to make up for lost production, prices in the U.S. have encouraged plantings while reflecting growing concerns.
What else could go wrong as La Nina’s lack of jet stream movement starts to result in more hot and dry weather forecasts.