Inside the Market             02/13 04:59

   Will the Market Encourage More US Soybean Acres?

   Just as quickly as the late-fall soybean rally came, it went, leaving 
looming supply side questions for the U.S. soybean market in 2026.

Rhett Montgomery
DTN Lead Analyst

   Editor's Note: This article originally appeared in the February issue of 
Progressive Farmer.

   **

   In the December issue of Progressive Farmer, I discussed a possible acreage 
scenario for the 2026-27 marketing year and predicted based on very early 
circumstances that soybean acreage in the United States would grow in 2026 by 
roughly 3% from 2025, specifically to between 83 million and 84 million planted 
acres. Since China agreed in principle to return to a "normal" degree of 
soybean purchases from the U.S. during the next three years, the market has 
been preoccupied with whether such demand is possible.

   However, with 17-month highs in soybean prices rapidly evaporating, and 
early profitability projections for 2026 continuing to paint a challenging 
landscape for producers, the better topic to discuss may in fact be whether the 
supply side of the U.S. market can even accommodate this "return to normalcy" 
in regard to export demand.

   Let's assume for a moment that USDA is correct in its most recent balance 
sheet, and that 2025-26 soybean ending stocks swing to a six-year high of 350 
million bushels (mb) amid a 13-year low in export demand. During the past five 
years, China has accounted for roughly 53% of U.S. soybean exports, meaning the 
"promised" 900 mb of purchases by China could reasonably be expected to be part 
of a 1.7-billion-bushel (bb) export program in 2026-27, 125 mb higher than the 
latest USDA forecast for the current marketing year.

   As for domestic soybean demand, assuming the crush industry continues its 
recent rate of growth to 2.65 bb of usage by 2026-27, along with an average 
degree of seed and residual demand of 110 mb, would, together with exports, 
suggest 4.09 bb of soybeans will need to be produced to meet demand (assuming 
350 mb of beginning stocks along with 20 mb of imported soybeans).

   Regarding supply, if soybean area in 2026 only grows marginally to 81 
million harvested acres, and the national average yield equals 2025 at 53 
bushels per acre (bpa), then carryout stocks for the 2026-27 season would fall 
to just above 200 mb, the lowest since 2015-16. Even if acreage were to land 
another 2 million higher, to 83 million harvested, the same equation still 
returns lower year-over-year stocks of 307 mb.

   By this math, it would take an increase of 3.4 million harvested acres with 
a 53-bpa average yield for U.S. soybean stockpiles to expand year over year, 
leaving little margin of error for production.

   Now, bear in mind that the above exercise does include a few 
behind-the-scenes assumptions. Factors such as Brazil's crop size, biofuel 
policy, Chinese soybean demand as well as U.S.-China relations all play a 
significant role. As alluded, you'll also note the sensitivity of the balance 
sheet to soybean yield, as well, as just 1 bpa in either direction is north of 
80 mb added or subtracted from the bottom line.

   There is still a lot of time to go until harvest 2026 in the U.S. and many 
moving parts to consider. A major function of the futures market is to perceive 
and efficiently factor supply and demand risk into prices, and I can certainly 
understand the market's immediate attention going to factors such as potential 
for yet another record crop out of Brazil to go along with a painfully slow 
start for U.S. exports. However, as the U.S. planting season approaches, I am 
not sure current prices (at the time of writing this in mid-January) adequately 
incentivize producers to plant "normal" soybean acreage in 2026, if the plan is 
indeed for a return to "normal" export demand by 2027.

   Rhett Montgomery can be reached at rhett.montgomery@dtn.com

   Follow him on social platform X @R_D_Montgomery




(c) Copyright 2026 DTN, LLC. All rights reserved.