Soybean futures sank this week after news out of Washington dashed hopes for a bullish soybean market.
On Thursday, President-elect Trump nominated Oklahoma’s Attorney General, Scott Pruitt, to head the Environmental Protection Agency. Under Pruitt, the EPA may be less likely to support biofuels like corn-based ethanol and soy-based biodiesel.
If the EPA reduces mandates to use these fuels, demand for corn and soy could drop noticeably. This has led to disappointment among some farm-industry groups who expected Trump to create a more farmer-friendly EPA.
Then on Friday, the U.S. Department of Agriculture jumped its monthly estimate of global soybean production based on larger crops in India and Canada, while leaving unchanged its estimate of this year’s record-breaking domestic soybean crop.
Altogether, this rough news knocked beans to a two-week low near $10.20 on Friday.