The early euphoria of the announcement that China would be purchasing U.S. soybeans is worn off, and prices are lower, as the actual amount of Chinese buying has not matched the hopes and expectations of the industry.
What’s happened
In the last month, January 2026 soybean futures lost nearly 85 cents of value. This price pullback lower was something I discussed as a possible scenario four weeks ago.
In late October and early November soybean futures were supported by news from the current administration that China was indeed going to be buying U.S. soybeans as part of a trade deal. Soybeans were also supported by slightly lower U.S. ending stocks in the November USDA WASDE report. As a result, soybean futures rallied over $1.
Since then, however, Chinese purchases have been slow and nowhere near industry expectations. Trade was looking for China to purchase 12 million tons of U.S beans by year end. But U.S. Treasury Secretary Scott Bessent recently said those large purchases from China may not occur until the end of February. The confusion, and lack of big purchases, led to a price selloff for soybean futures.
From a marketing perspective
The slow pace of export demand to China is weighing on soybean futures prices. Also potentially weighing on soybean futures is a technical chart formation on daily charts called a “head and shoulders” formation.
When traders see a chart formation like this, it can be a potential road map for where prices could go.
Keep in mind, the actual fundamental news dictates price direction. However, in this instance, the lack of friendly demand news has weighed on prices, allowing for this technical charting price formation to nearly come to fruition.
Below is a daily chart of the January 2026 soybean futures, with the head and shoulders formation illustrated. The price of the top of the “head” is $11.69½. The price of the “neckline support” is the $11.15 area. To figure out the price breakout lower potential of this chart formation, take the price difference between $11.69½ and $11.15. That price difference is 54½ cents.
That points to 54½ cents as the possible price move lower, should the market breach price support of the neckline of the head and shoulders formation.
Subtract 54½ cents from the $11.15 support area, and the target price lower to fully achieve the price breakout of the head and shoulders formation is $10.60½. Note there is a gap to fill on the chart at $10.63.
Keep an eye on this. This is a potential target for traders who like to focus on technical aspects of the market. This may be a price where the market finds a short-term low. It may also be a price point where China comes in with a large purchase of U.S. soybeans, since they would be “on sale” from a value perspective.
Prepare yourself
Fingers crossed that this recent price sell off for soybean futures leads to increased export demand from China. That would then be supportive for prices, and lead to a potential price recovery rally.
Recently, I wrote about a potential Christmas rally for corn. Might the soybean market rally into the Christmas season as well?
Let’s take a look at what the past decade has shown. For the purpose of my simple research project, I looked over the past decade (11 years actually) for any type of rally for soybean futures from Thanksgiving until the end of the year.
I used the March soybean futures contracts as the January soybean contract would be tangled in its delivery period during this timeframe.
Also, since the date of Thanksgiving changes, I used Nov. 20 as the annual start date.
While each year over the past decade has provided unique fundamental supply and demand perspectives, in each year over the past decade March soybean futures have had some sort of rally between Nov. 20 and the end of the calendar year.
It’s not perfect, and the dates of the “Thanksgiving low” are vastly different over the years. (Last year the low did not occur until Dec. 19!). And the price high date is also significantly different. However, the average soybean rally for March futures during this time window was 88 cents.
Strong reminder, friendly news is needed to justify a price recovery rally. Keep one eye on U.S. soybean export purchases from China and one eye on South American soybean weather in the coming weeks.
Reach Naomi Blohm at 800-334-9779, on X: @naomiblohm, and at naomi@totalfarmmarketing.com.
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