FX.co ★ Soybeans Jump to 14-Month Peak

Soybean futures rose to about $12.40 per bushel, the highest level since May of last year, as escalating tensions in the Middle East drove a sharp increase in oil prices. Crude oil climbed to multi-week highs after Iran-backed Houthi militants claimed responsibility for attacks on two Saudi oil tankers in the Red Sea, and US President Donald Trump threatened to strike Iranian infrastructure in retaliation for any assaults on vessels passing through the Strait of Hormuz. Soybean prices often follow crude oil because soybeans are a key feedstock for biofuel production.

Prices were also supported by robust export demand, following a new wave of sizable US sales to China and other buyers reported this week. The USDA confirmed sales of 340,000 metric tons to China, 246,634 tons to Mexico, and 110,000 tons to an unknown destination, in addition to an earlier sale this week of 136,000 tons to China.

At the same time, crop conditions remained favorable. The USDA rated 66% of the US soybean crop as being in good-to-excellent condition, up one percentage point from the previous week and above market expectations.