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Jul 14, 2025
By Jacquie Holland, ASA Economist & Claire Shelton, ASA Economics Intern
The July 2025 WASDE report published by USDA Friday offered a mixed bag of results to U.S. soybean markets. While soybean oil futures prices continued their upward price march, soybean futures and soymeal prices fell to multi-month and multi-year lows, respectively.
The ending stocks estimates for 2024/25 remained unchanged at 350 million bushels after USDA took 15 million bushels from 2024/25 residual usage and reassigned it to export volumes.
USDA increased the average annual price received by farmers from $9.95/bu. to $10.00/bu. for 2024/25 crops. The price increase suggests recent usage rates are running higher than previously forecast despite the June 30 Quarterly Grain Stocks Report which pointed to higher supplies and lower usage through the winter and spring.
Production projections for July 2025/26 decreased by 5 million bushels to 4.335 billion bushels from the June 2025 production projections. This decrease is correlated with the lower planted soybean acreage reported in USDA’s June 30 Acreage report. Yield forecasts remain the same from June to July projections at 52.5 bushels per acre.
Ending stocks for 2025/26 projections increased by 15 million bushels to 310 million bushels. USDA decreased anticipated 2025/26 total supplies due to the reduced 2025 soybean acreage.
Even with a slightly smaller 2025 soybean harvest, crush volumes increased 50 million bushels to a new high of 2.54 billion bushels. This increase is supported by additional crush plants planned to be in operation for the new crop year, higher RVO volumes, increased biofuel feedstock import penalties and the recent passing of 45Z tax credits in the budget reconciliation package.
Export volume in 2025/26 decreased by 70 million bushels from prior projections to 1.745 billion bushels. Rising domestic soybean consumption paired with trade uncertainties will continue to represent a risk to U.S. soybean price stability, especially if new plants struggle with startup operations this fall or if crush margins do not support crush plants operating at maximum capacity.
In summary the decrease of 5 million bushels in production, decrease in 70 million bushels in the export market, and increase of 50 million bushels for crushing, are the reasons behind the 20-million-bushel increase in ending stocks presented in the July 2025/26 projections.
The increase to 2025/26 ending stocks due to reduced export consumption resulted in USDA reducing the new marketing year’s seasonal average soybean price by $0.15/bu. to $10.10/bu. Prices remain slightly higher in the upcoming marketing year relative to current price forecasts, reflecting economic optimism for domestic demand increases due to biomass-based diesel production.
Soybean oil was the clear winner of Friday’s reports, with nearby August 2025 futures prices closing the daily trading session $0.0104/lb. (2%) higher after USDA increased 2025/26 biofuel consumption of soybean oil by 1.6 billion pounds to a record-setting 15.5 billion pounds.
USDA updated its policy guidance to justify the usage increase, reflecting updated policies introduced in the past month. Higher RFS volumes, limitations on imported biofuels feedstocks and tax incentives from 45Z passed in the reconciliation bill are highly supportive of domestic soybean consumption. They will provide more price stability for soybean producers despite ongoing tariff uncertainty.
The increase in soybean crush volumes will result in higher soybean oil production in 2025/26, with volumes rising 4% from the prior year to 29.970 billion pounds. A 3% annual increase in usage rates will push 2025/26 usage to 30.2 billion pounds, requiring a 150-million-pound increase in soybean oil imports to fulfill production orders at crush plants.
The added supplies will be put to good use. USDA projects 2025/26 soybean oil consumption for biofuels will rise by a staggering 27% annually after USDA increased new marketing year forecasts by 1.6 billion pounds to 15.5 billion pounds in the July 2025 WASDE. The additional domestic consumption will limit exportable volumes, resulting in a one-billion-pound decline in 2025/26 soybean oil exports and dropping the annual total by nearly three-quarters to 700 million pounds.
Even though USDA increased 2025/26 ending soybean oil stocks by 140 million pounds from last month’s WASDE to 1.671 billion pounds, the surge in domestic consumption will push prices higher as domestic liquidity tightens. USDA increased the 2025/26 average soybean oil price by $0.07/lb. in the July 2025 WASDE report to $0.53/lb.
The price uptick should provide enough incentive to crush plants to increase capacity utilization, which has stalled in recent months amid biofuels policy uncertainty and surplus soymeal supplies. After multiple months of biofuels policy uncertainty, soybean oil is finally benefiting from policy tailwinds as harvest 2025 approaches.
USDA left 2024/25 ending stocks unchanged at 1.451 billion pounds, with reductions to imports and increased food, feed and industrial volumes offsetting another sharp (650 million pounds) reduction in soybean oil consumed for biofuels. To reflect the uptick in domestic consumption, USDA increased the marketing year average prices by $0.0050/lb. to $0.4650/lb.
While the increase in soybean crush volumes and soybean oil production is keeping price prospects relatively stable for those commodities, soymeal has not enjoyed as much luck.
Rising crush volumes will result in 1.15 million short tons of more soymeal production in 2025/26, raising next year’s output forecast to 59.85 million tons. added supplies weighed heavily on futures prices, pushing nearby August 2025 futures prices to nine-year lows as market concerns grow regarding the U.S. soybean industry’s capacity to move the added soymeal to end users.
Both international and domestic soymeal end users may have more financial incentive to incorporate soymeal into livestock rations in the months ahead. USDA forecasts 2025/26 average soymeal prices will drop $0.20/ton to $290.00/ton in the new marketing year. The discounted prices will inevitably make U.S. soymeal an affordable option on the global market as well as at home.
While USDA managed to leave 2025/26 soymeal ending stocks unchanged at 475,000 short tons, the supply pressure will undeniably mount in the soymeal complex next year. Prices on the Chicago Board of Trade dropped to a nine-year low following the supply increase in the WASDE report, emphasizing the need to quicklyand economically—find new homes for U.S. soymeal in the year ahead.
