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US Biofuels Update: Energy Markets, Favorable Weather Weigh on Soybean Complex

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Biofuels feedstock futures closed lower on Thursday, as traders displayed caution ahead of a long weekend, with markets closed on Friday in observance of Juneteenth.

The Chicago Board of Trade July soybean futures contract closed 0.82 lower at $11.22 per bushel, and the CBOT July soybean oil futures contract settled 2.59% lower at 69.69 cents per pound.

The Nymex July ethanol futures contract settled 0.27% higher on Wednesday at $1.84 per gallon.

On Thursday, the Federal Reserve voted to hold interest rates steady in an almost universally expected move. Outside markets were mostly supportive, with higher energy markets, though crude fell well off daily highs.

Rhett Montgomery, a DTN analyst, said that the turn lower for soybean futures was a bit puzzling.

The US Department of Agriculture announced flash sales totaling 20.8 million bushels to China and other unknown buyers over the past two days, the analyst said.

"Weather for the most part continues to cast a bearish shadow over row crop futures, with plenty of rainfall still in the forecast for the balance of June, and drought reductions noted for both corn and soybean areas in the US," Montgomery said in a daily note.

He added that the soybean market was unable to complete a four-session winning streak during the shortened trading week. The analyst attributed the decline to textbook "buy the rumor, sell the fact" trading after the USDA confirmed rumors of Chinese soybean purchases.

Montgomery noted that weakness in energy markets and lower soybean oil futures further pressured the market.

On Thursday, the USDA confirmed flash sales of 132,000 metric tons of soybeans for delivery to China during the 2026/2027 marketing year.

Also, 285,775 mt of corn for delivery to Mexico during the 2026/2027 marketing year. In addition, 120,000 mt of soybeans are for delivery to unknown destinations during the 2026/2027 marketing year.

USDA's Weekly Export Sales Report on Thursday showed that for the week ending June 11, an increase of 15.6 million bushels or 424,900 mt of soybean export sales in 2025-26 and an increase of 11.2 mb or 304,100 mt for 2026-27.

Last week's export shipments of 20.3 mb exceeded the 15.2 mb needed each week to meet USDA's export estimate of 1.510 billion bushels for 2025-26.

Soybean export commitments now total 1.491 bb in 2025-26 and are down 17% from a year ago. That is ahead of USDA's estimated pace, even as its estimate of US ending soybean stocks is 16% larger than the previous five-year average.

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