Soy demand rises to meet large crop

Soybean farmers and market watchers alike were salivating for USDA’s first look at farmer-surveyed yields ahead of the August 2026 Crop Production and World Agricultural Supply and Demand Estimates report published Aug. 12.

Yield turned out to be a smaller-than-anticipated factor in early forecasts of the 2026 U.S. soybean crop, according to USDA’s data.

Rather, a larger-than-expected increase in acreage pushed projections for the 2026 soybean harvest to a new record high.

Soybean futures prices were hardly deterred by the behemoth supply outlook, gathering strength from corn’s price gains, increased soy-crush volumes and continued export purchases by China.

Prices rise on robust demand forecasts

Nearby September 2026 soybean futures prices rose 13.75 cents per bushel (1.1 percent) to $11.65 per bushel on the favorable usage data.

New-crop November 2026 futures notched a similar price gain following the Aug. 12 USDA reports, rising 14.5 cents per bushel (1.1 percent) to close at $11.835 per bushel.

USDA increased 2025-’26 crush volumes by 5 million bushels to 2.655 billion bushels to reflect lucrative soy-crush margins.

The large 2026 crop, high soybean-oil prices and expectations for strong crush margins to continue amid more export competition justified USDA’s decision to increase new-crop consumption.

About 30 million more bushels were added to 2026-’27 crush volumes, raising the new marketing-year crush total to 2.78 billion bushels.

September 2026 soybean-oil futures added more than a half a cent per pound (0.9 percent) to end Wednesday at 69.16 cents per pound.

USDA left season-average prices unchanged at 64 cents a pound for 2025-’26 and 70 cents a pound for 2026-’27.

Current marketing-year soybean-oil usage remains hot and while next year is going to sizzle even more on growing renewable diesel consumption, USDA was slightly more conservative in next year’s growth trajectory.

USDA forecasts for soybean oil for biofuel consumption in 2025-’26 rose by 150 million pounds to 14.7 billion pounds for the current marketing year, outpacing recent production gains.

USDA expects 2026-’27 soybean-oil production to near 33 billion pounds on rising new-crop crush volumes, though the additional 355 million pounds of production was allocated solely to food, feed and other industrial consumption instead of biomass-based diesel consumption.

Soymeal futures prices benefited from growing export forecasts and consistently higher domestic livestock consumption.

USDA expects soymeal consumption for domestic livestock and export markets in both 2025-’26 and 2026-’27 marketing years to outpace rising crush volumes, leaving the industry dependent upon larger import volumes to satisfy demand.

USDA raised 2025-’26 season-average prices $5 a ton to $320 per ton on the sentiment, while 2026-’27 prices held steady at $310 per ton.

Nearby September 2026 soymeal futures rose $3.50 per ton (1.1 percent) higher on USDA’s revisions to close the Aug. 12 trading session at $308.50 per ton, a three-day high.

A big crop grows bigger

Markets had been expecting USDA to report a yield estimate closely mirroring USDA’s trendline forecast of 53 bushels per acre (bpa).

The prereport analyst estimates ranged between 52 and 53 bpa with an average guess of 52.9 bpa.

Farmer reports led USDA to peg the August soybean-yield forecast at 52.7 bpa, slightly below market expectations, and the second-largest U.S. soybean yield on record, if realized.

Perhaps it is too early to put too much stock in the August soybean yield.

When USDA conducted the August 2026 yield survey during late July through the first week of August, most soybean crops around the country were just undergoing peak pod-fill activity.

Soybean yields reported by farmers at this point are more likely to be wild guesses than observations.

Historically, October and November yield estimates for soybeans tend to have a smaller variance to final yields reported in January, so the soybean market may have to wait a little longer for yield certainty.

One item in USDA’s August Crop Production report that provided more certainty was acres.

USDA resurveyed farmers for acreage in the August Crop Production report.

Additionally, the August-acreage estimate was reconciled against FSA certified acres, RMA insured acres, satellite imagery and field observations, providing the most accurate estimate of 2026 soybean acreage to date.

Headed into the report, traders forecasted a harvested acreage range of 84.4 million to 85.4 million acres, with an average guess of 84.6 million acres.

USDA topped all guesses at 85.5 million acres, finding an extra 1.4 million acres (1.7 percent) of soybeans to be harvested this fall, compared to 84.4 million acres estimated in the June 2026 acreage report.

While the I-90 corridor reported lower soybean acres, other states on the Mississippi River Valley made up the difference.

South Dakota, Iowa and Illinois reported 200,000 fewer planted acres in the August 2026 Crop Production report.

Ohio also had 150,000 fewer 2026 soybean acres.

Additional soybean acres were found in Missouri (350,000), Mississippi (330,000), Minnesota (300,000), Arkansas (250,000), Nebraska (250,000) and Louisiana (170,000).

The acreage bump in the Mississippi River Delta region puts states shipping soybeans for export into the U.S. Gulf in good position as China continues to book volumes for 2026-’27 shipment.

These states are typically the first area from which the Gulf pulls to source fall soybean exports.

Even with the smaller yield, the acreage bump will push up forecasts for a record 2026 soybean harvest.

USDA now projects the 2026 crop to reach 4.519 billion bushels, a 44-million-bushel (1 percent) increase from prior estimates.

The revised production outlook was on the higher side of prereport trade expectations, which ranged between 4.389 billion to 4.552 billion bushels.

USDA’s Farm Service Agency also published its first round of prevent-plant data for the 2026 growing season.

Farmers reported 525,376 failed soybean acres in 2026, down over 744,000 acres from the prior year.

The low prevent-plant acreage this year suggests cooperative support from Mother Nature this spring, which allowed the maximum amount of soybean acres to be planted.

A record-setting U.S. soybean crop will be harvested this fall from the sixth-largest acreage.

Barring a soggy harvest, yield forecasts in the October and November Crop Production reports will be the determining factor for 2026-’27 supply outlooks.