USDA Report Triggers Soybean Selloff as Inventory Outlook Shifts

Soybean futures experienced a significant decline on Monday, with losses ranging from 7 to 15½ cents across most contract months, though some back months showed marginal gains. The national cash soybean price fell 13¼ cents to settle at $9.76½, reflecting broader weakness in the complex. Downward momentum was amplified by soymeal futures, which declined $3.10-5.40, while soy oil provided minimal support with gains of 32-58 points.

Delivery Activity and Production Adjustments

Trading activity remained active with 33 soybean deliveries issued on Friday evening, including 2 for January soymeal contracts. The latest Crop Production report released Monday morning confirmed the NASS soybean yield at 53 bushels per acre, unchanged from November’s assessment. However, harvested acreage ticked slightly higher to 80.4 million acres, pushing total production up 9 million bushels to 4.262 billion bushels.

Inventory Levels Paint Mixed Picture

December 1 soybean inventory figures reveal a more nuanced market dynamic. Quarterly Grain Stocks data showed carryout reserves at 3.29 billion bushels—190 million bushels above year-ago levels but 40 million bushels above analyst expectations of 3.25 billion. This inventory build, while larger than anticipated, set the stage for USDA’s subsequent adjustments in its supply-demand projections.

USDA WASDE Revisions Reshape Market Expectations

The USDA incorporated production data into its latest WASDE update while making strategic revisions to its demand forecasts. Export estimates were trimmed 60 million bushels to 1.575 billion bushels, while crush usage was raised 15 million bushels to 2.57 billion bushels. These competing adjustments resulted in a net increase to ending stock projections of 60 million bushels, now pegged at 350 million bushels—a factor that likely contributed to Monday’s selling pressure as traders digested the higher carryout outlook.

Export Pace and Global Dynamics

Recent export shipment data highlighted shifting trade patterns. USDA’s FGIS reported soybean export shipments of 1.529 MMT (56.21 million bushels) for the week ending January 8—the second-largest weekly total of the marketing year. This represented a 55.4% increase from the prior week and 12.7% above the comparable week last year, with China accounting for 901,118 MT and Mexico receiving 126,235 MT. Year-to-date marketing year exports, however, tell a different story. Since September 1, cumulative shipments reached 17.934 MMT (659 million bushels), representing a 42.7% decline compared to the same period in 2024.

Brazilian Production Upgrade

The USDA also adjusted its Brazilian soybean production forecast upward by 3 million metric tons to 178 MMT in its WASDE report. Field progress reports indicate AgRural estimates Brazilian farmers had harvested 0.6% of the crop by last Thursday, slightly ahead of the 0.3% pace from the prior year.

Futures Settlement Summary

January 2026 soybeans closed at $10.33, down 15½ cents, with nearby cash beans at $9.76½, down 13¼ cents. March 2026 soybeans declined 13½ cents to $10.49, while May 2026 contracts closed at $10.61¾, down 12¾ cents. The consistent selling across the contract curve suggests traders are pricing in the higher carryout expectations and moderating export demand outlook.