The organic soybean complex is in danger of experiencing upside momentum, which could significantly buoy organic soybean prices. Organic soybean prices are elevated, but activity is light because there is not a lot of product available. Organic soybean imports in March were light as expected. April should be similar, according to The Jacobsen.
A question for traders is how quickly India will be able to rebound from port closures. The “shelter in place” order sent workers from other countries home until it was safe to return and work was available. Indian exporters are saying that flood of Egyptian workers has left the country. Getting the engine that creates the organic soybean export machine up and running could take some time. For the 2019/2020 season, Jacobsen expects imports to use to hover above 70%. This means that 70% of the organic soybeans consumed in the US are imported.
For US consumers, unfortunately, there are no sellers according to merchandisers. This includes both organic soybean and organic soybean meal. This could create panic buying sending prices temporarily higher. The Q3 is likely a target period after the pipeline from India goes dry for most of the Q2.
Organic soybean imports were robust in February the last official month reported by the US Customs Department. There was small growth for the month, year over year. The Jacobsen forecast that March organic soybean imports were no-existent. Less than 1,000 metric tons likely arrived.
The Jacobsen sees organic soybean and organic soybean meal imports remaining well below the historical norm for the Q2, and then potentially rebounding significantly in the Q3 due to pent up demand. this could push organic soybean prices mid-west up to $23 per bushel. It could also push organic soybean meal prices above $850 per short-ton. The Jacobsen full forecast along with our organic soybean balance sheet can be found in The Jacobsen organic market intelligence report.