Non-GMO soybean meal price premiums are facing downward pressure. The accelerated rise in the price of conventional soybean meal on the board has led to a contraction in the premiums. Buyers who are looking for flat prices are less willing to pay for a robust premium for non-GMO soybean meal compared to a month ago.
Merchandisers are telling The-Jacobsen that non-GMO soybean meal price premiums over conventional are closer to $100 per short-ton compared to $120-$130 per short-ton a month ago. The decline in non-GMO soybean prices is beginning to weigh on non-GMO soybean prices. While certain IP beans that are used for food-grade consumption, and shipped to Asia, continue to keep their value, feed grade non-GMO beans are experiencing a wider bid-offer spread.
Non-GMO Dairy Rises
Despite the downtick in non-GMO soybean meal prices, demand at the retail level for non-GMO proteins continues to rise. Non-GMO milk sales, which make up the largest component of non-GMO dairy sales, rose 17% year over year in October according to The Jacobsen. For the 8-months ending October 2020, non-GMO milk sales have increased more than 24% year over year. The trend continues to be upward sloping and the recent spread of the virus during the fall is likely to generate more purchases at supermarkets further buoying non-GMO milk sales. The upshot is despite the continued demand for non-GMO dairy, the rally in conventional soybean meal is generating a cost issue for dairies that is weighing on price premiums.