The price of soymeal in South America has dropped to its lowest level in the past four years, primarily due to two key factors:

1. Declining Soybean Futures in CBOT: The futures prices of soybeans on the Chicago Board of Trade (CBOT) have fallen by over 20% in 2024, which has had a direct impact on the price of soymeal. Despite soybean oil remaining in high demand and holding strong prices, soymeal has not seen similar demand, contributing to its price drop.

2. Increased Soybean Crushing: Both Argentina and Brazil, the world's leading soymeal producers, have ramped up their soybean crushing operations. Argentina's soybean crushing in the 2023-24 season is expected to rise by 45% to 42 million tonnes compared to the previous year, driven by a strong production recovery after a low output in the prior season. Brazil has also seen record soybean crushing, with an estimated 45.6 million tonnes crushed in September 2024, and projections suggest the annual total will hit a historic 55 million tonnes.

The rise in crushing activity has led to a significant increase in the production of soymeal, which, combined with the falling soybean futures prices, has contributed to the current price drop. As of mid-November 2024, the free-on-board export prices of soymeal from Brazil and Argentina were recorded at $322.42 and $320.77 per tonne, respectively, marking the lowest levels since mid-2020.

Additionally, expectations for a bumper soybean harvest in 2024-25 in Brazil and Argentina are also influencing the market, creating a psychological effect that further pressures soymeal prices. This combination of factors—higher supply and lower futures prices—has created a challenging market environment for soymeal producers and exporters in South America.