Grains » Soybean Meal Futures

Now you can trade Soybean Meal futures at optionsXpress! Open an account to trade futures at optionsXpress.

Contract Size
100 Tons
Tick Size
0.10 = $10.00

About CBOT Soybean Meal Futures

Soybean meal is the dominant protein supplement used in U.S. livestock and poultry feeds. Technical uses include adhesives, cleansing materials, polyesters, and other textiles. But soybeans have many other uses, too. Most importantly, of course, they serve as a central ingredient in baby food, diet-food products, beer, ale, noodles, cooking oil, margarine, mayonnaise, salad dressing, shortening, etc. Lecithin is a natural emulsifier derived from soybeans. Several important low-fat sources of protein, such as tofu, miso, and soymilk also use soybeans as a major ingredient.

Here are several examples of how soybean meal futures can be used by those seeking to mitigate price risk, as well as by speculators who hope to earn an attractive return on their investments:

Risk Management for Processors

A soybean processing plant uses soybean, soybean oil, and soybean meal futures to hedge its gross processing margin — the difference between the cost of soybeans and the eventual revenue of the finished oil and meal. Buying soybean futures protects against rising input costs. Selling soybean oil and meal futures protects against falling prices for the later sales of meal and oil. This risk-management program helps to stabilize costs and pricing.

Cost Management for Livestock Producers

A large cattle feedlot, recognizing that the price of soybean meal has a significant impact on its bottom line, buys futures or call options to establish a cost ceiling for eventual feed procurement. In the highly competitive livestock business, where operating margins are often very thin, such risk-management strategies can mean the difference between a profit and loss.

Profit Opportunities for Traders

In hopes of realizing a profit, a California software developer decides to trade soybean meal futures. Based on fundamental news and technical analysis, he expects bean meal prices will rise, so he purchases soybean meal futures. Two weeks later, weather conditions reduce the soybean harvest forecast and soybean meal prices rise. The speculator sells his futures contracts at higher prices and profits from the transaction. This participation in the futures market did not require the trader to have any direct link to farming or food production.

CBOT Soybean Meal Futures Specifications

Soybean Meal futures, Chicago Board of Trade, trading symbol SM. The contract size is 100 tons. The minimum tick is 0.10, worth $10 per contract.

Trade electronically on the Globex platform from 7:00 PM US EST to 2:15 PM US EST on the following day. Please note that there is a maintenance period from 8:15 AM US EST until 10:30 AM US EST during which trading is halted.

Principal trading months for soybean meal futures include January, March, May, July, August, September, October, and December.

Please see the disclosures page for additional information regarding this section.