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BOGO bounces back $50/mt after surprising NOPA crush numbers

Updated: May 20

Crush numbers in the United States for April were disappointing coming in much lower than trade guesses at 166 Mil Bushels (a 3 year low) while Soyoil stocks were also lower by 5.2% to 1.755 Bil lbs. These numbers tell us that decrease in RD utilization has really spooked crushers who are now looking at a contango structure for crushing margins that had dropped to 1.24 nearby while july showing 1.47 and Aug 1.52 while Sep is 1.59. This is a $10/mt contango or extra screen crush to summer - $55/mt is a very attractive screen crush. Since the whole market has now switched to july futures pricing, april crush was probably a fluke and we can expect a significant recovery from here. Meanwhile in Paranagua, Soyoil FOB premium strengthen for a little while until futures strengthened and now we are back to wider bids at -520 for Jun. Nothing has truly changed except the weather in South America has improved. Argentina is finishing up its Soy harvest with increasing arrivals as farmers have only sold 31% of their crop - expect that crop to grow larger than 51 MMT as we are not running out of Soybeans!

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