Guangxi soymeal prices immune to typhoon Maysak, while U.S. soybean remains key driver

Affected by this year' s 10th typhoon "Maysak", Guangxi has experienced persistent heavy rainfall since July 4. According to the Central Meteorological Observatory, on July 5, central and eastern Guangxi saw torrential or extraordinary downpours. As of July 6, 82 monitoring stations across 65 rivers in Guangxi have reported flood levels exceeding warning marks.

Due to the typhoon's passage and persistent heavy rainfall, many soybean crushing plants in Guangxi have been forced to halt or reduce the operations. As of July 6, the average operating rate of crushers in Guangxi dropped to around 38%, down 14 percentage points week-on-week. Additionally, communications in Qinzhou, a major crushing zone, have been disrupted by heavy rainfall, and urban and port roads were severely flooded, hampering traffic. If rainfall continues, there is a possibility that more plants will suspend the operations and halt delivery due to power outages.

The torrential rain and road flooding have directly impacted Guangxi's soymeal logistics. Over the weekend (July 4-5), most crush plants in Guangxi suspended invoicing, with operations gradually resuming from July 6 onward. However, even as invoicing resumed, dispatch efficiency remained generally sluggish due to severe port-area flooding and traffic disruptions.

However, looking at the soybean meal spot prices, soymeal prices in Guangxi did not surge as sharply as expected. Comparing the four major regional soybean meal spot markets of Guangdong, Guangxi, Shandong, and Tianjin, 43% protein soymeal spot prices rose by 2.15%, 1.79%, 2.13%, and 1.72%, respectively, as of July 7, against last Friday July 3. Interestingly, Guangxi's price gains lagged even behind Guangdong and Shandong, regions unaffected by the weather disruption.

The reason lies in the fact that the typhoon's impact on actual soybean crushing capacity in Guangxi was relatively short lived, with disruptions more concentrated on logistics. However, logistical disruptions are evenly felt as whether local prices rise or prices in surrounding regions rise, shipments still cannot move.

Secondly, soybean meal supply in Guangxi is not tight. As of July 6, 2026, Guangxi soybean meal inventories stood at 66,200 tonnes, up 7,200 tonnes week-on-week and 196,600 tonnes year-on-year. The data indicates that local soybean meal stocks remain at historically high levels.

Thirdly, national soybean and soybean meal supply expectations for the coming months remain ample. According to Mysteel data, the actual soybean arrivals in June, as well as imported soybean arrivals forecast of July and August, all exceed 10 million tonnes.

Given the domestic soybean and soymeal inventory pressure, why did national soybean meal spot prices rise at all? The primary driver was the recent sharp rally in U.S. soybean futures, fueled by the bullish news of Chinese purchases of U.S. soybeans.

The CBOT soybean main contract gapped higher on Monday, surging nearly 50 cents/bushel from Friday's closing price of 1146.75 cents/bushel, with intraday highs touching 1197 cents/bushel, a maximum gain of 4.18%. On the same day, the DCE soymeal futures M2609 followed suit, opening at Yuan 2,962/tonne and closing at Yuan 3,026/tonne, up Yuan 57/tonne, with an intraday peak of Yuan 3,026 /tonne and a maximum gain of 2.16%. National spot prices tracked the futures market higher, which also explains why domestic soybean meal price increases underperformed those of U.S. soybeans.

Looking ahead, domestic soybean arrivals remain ample, crusher operating rates are steadily above 60%, soybean meal inventories continue to accumulate, and overall spot supply remains loose. On the demand side, the livestock sector is in its off-season, with hog industry losses constraining feed purchasing volumes.

Only the aquaculture sector maintains seasonal essential demand, while feed mills largely purchase on an as-needed basis, with little impetus for large-scale restocking. In the near term, futures prices are primarily driven by U.S. soybean weather developments and procurement-driven bullishness, with strong cost-side support.

DCE M2609 is expected to trade in a choppy-to-firm pattern in the short term, with upside resistance at Yuan 3,060-3,080/tonne. Absent further extreme weather in the U.S. soybean belt or additional bullish catalysts, soybean meal futures may retreat to range-bound trading after the initial surge.