Although most soybeans are used for the extraction of soybean oil (used as vegetable oil for culinary purposes) and soybean meal (used primarily as an agricultural feedstock), whole soybeans are also a tradable commodity. The crop in the United States begins in September, and the production of soybeans is cyclical.

What is the commodity price of soybeans?

Agriculture

Why is soybean such a pivotal commodity in society?

Around the world, there is a surging demand for soy—the “king of beans.” Soy is a globally traded commodity produced in both temperate and tropical regions and serves as a key source of protein and vegetable oils. Soybeans also reach our tables as oil—which represents around 27% of worldwide vegetable oil production.

Are soybeans expensive?

Soybeans are not expensive to buy, compared to the cost to produce. The cost is high due to the output per acre, and the inputs such as herbicides and insecticides that are used, as well as planting and harvesting costs. And what sets the price is the demand.

How much is a ton of soybeans?

In 2019, the average price for soybeans stood at 369 nominal U.S. dollars per metric ton.

Why are soybeans so important?

Because soybeans are high in protein, they are a major ingredient in livestock feed. Soybeans are processed for their oil (see uses below) and meal (for the animal feed industry). Soybeans are also used in many non-food (industrial) products. Some soybeans are needed to produce another crop each year.

Is the world’s second largest producer of soybeans?

Brazil (86.8 million metric tons) As the second largest producer of soybeans worldwide, Brazil accounts for 30 percent of the global production of the crop.

How are soybeans related to other agricultural commodities?

The price of soybeans is usually highly correlated with the price of other grains, such as corn and wheat. Many of the economic and trade factors that move soybean prices affect agricultural commodities in general, including:

Are there any risks in investing in soybeans?

Investing in agricultural commodities is a way to benefit from this trend. However, traders should also consider the risks of investing in soybeans: A strong US dollar could drive prices lower. Overproduction by large suppliers could depress prices. This scenario could unfold, for example, if the United States ends corn subsidies.

Why are there more soybeans in the US than corn?

US farmers make choices about growing corn and soybean crops at the beginning of the growing season. If corn subsidies were to end, farmers might devote more acreage to soybeans. The resulting increase in soybean supply would probably put pressure on prices.

What do traders need to know about soybean futures?

Traders should pay attention to the sessions where commodities trade because different times of the day can lead to variations in the amount of liquidity present. The CME also offers an options contract on the soybean futures contract. Options are also a derivative instrument that employs leverage to invest in commodities.