US Government Move May Trigger Market Breakdown: Feeder Contracts and Soybean Oil at Risk

The US Government's attempt to lower cattle prices may have broken through the market, with the October'26 Feeder Contract and beyond potentially reaching selling levels. The Feeders closed locked limit down yesterday, just 24 hours after the government's move was announced. With three days left in the week and the month, analysts expect a push towards lower prices by the end of the week. The December'26 Soybean Oil has dropped 4.05 over the last three trading days, with US Soybean conditions down 3% to 63% Good/Excellent compared to 73% last year.

China's continued purchase of US Soybeans and Brazil's lowered soybean stocks are also contributing to lower prices for Soybean Oil. India's delayed monsoons have led to a decrease in planting for both Soybean and Cotton crops, while China's rapeseed yield has dropped to 3.14mt and Sunflower yield to 1.94mt.

OPEC+ may curb production increases for 2026, keeping Crude Oil prices high and potentially pushing the Bean Oil higher as well. With demand for vegetable oils skyrocketing for use in biofuels and edible oils, analysts expect huge upside in the Soybean Oil Market, with December'26 trading into the 80's by the end of the year.