European Soymeal slides on strong dollar, good weather

European soymeal prices were lower on Friday, under pressure from a strong dollar and forecasts for good weather in the United States. Prices for South American soymeal were cut by up to $6 per tonne, with Brazilian high protein stocks for August shipment dipping to $411 per tonne. Argentine high-protein soymeal also slid to $395 per tonne, down $5 from the previous day.
EU soymeal prices also lost between $4 and $11 per tonne, with the August position dipping to $398 per tonne. The market was mainly pressured by a strengthening in the dollar as positive US jobs data fuelled speculation of a Federal Reserve interest rate hike next month. A strong dollar makes meals and feeds denominated in the currency more expensive for international buyers. Good weather conditions in the United States, a key producer of soybeans, also continued to push European meal prices down. Meanwhile, Chicago soymeal futures rose slightly, with the August contract SMQ5 edging up by 0.57 percent to $352.10 per tonne at 1611 GMT.
The rise was largely driven by expectations the US Department of Agriculture will cut its soybean yield estimates in a report next week. But gains across the soybean complex were capped by forecasts for more good weather in the US Midwest in the coming weeks. European rapemeal prices were also lower, with most positions dipping between 1 and 5 euros per tonne. Rapemeal stocks for August delivery dipped by 5 euros to 238 euros per tonne by the end of trading.
The rapemeal market was subdued as harvesting progresses and traders said prices were weighed by speculation European rapeseed crops might have suffered less weather damage than previously expected. Rapemeal has rallied recently on expectations of a drop in European rapeseed production. But good yields on other crops are casting doubts on the supply outlook. "There's a big crop in wheat and barley and that's placing a certain pressure on all commodities," one European trader said. "It's purely because of poor sentiment and because it's harvesting time.