Soybean, soymeal futures fall on African swine fever worries

China’s soybean and soymeal futures fell in early trade on Monday, hit by concerns that outbreaks of African swine fever in China may reduce demand for feed, along with forecasts for a record US crop.

China’s soybean futures fell 1.7 percent to 3,594 yuan ($522.84) per ton, their lowest levels in almost 10 years.

Domestic soybeans are mainly used in the food sector, but they often track soymeal prices.

The most-actively traded soymeal futures on the Dalian Commodity Exchange for delivery in January dropped 1.9 percent to 3,070 yuan per ton, their lowest since late June.

High inventories in China also weighed on the market.

“Soybean meal and domestic soybeans are expected to drop further on forecasts of a bumper harvest in the US and Brazil’s depreciating currency,” said Pan Tiantian, analyst with Zheshang futures.

Advisory service Pro Farmer, a division of Farm Journal Media, on Friday projected that 2018 US soybean production would reach a record 4.683 billion bushels based on an average yield of 53.0 bushels per acre. Pro Farmer’s soybean crop forecast topped the US Department of Agriculture’s (USDA) already record outlook for a crop of 4.586 billion bushels as last week’s crop tour found larger-than-expected soy pod counts in all states surveyed.

“Pressure from the fundamentals here is already huge, and now there’s the African swine fever outbreaks. If the disease keeps spreading, it will have a bigger impact on the already weak demand for meals,” Pan said.

China has culled over 25,000 pigs after the nation reported four African swine fever outbreaks in a month.