The Soybean Crush

In the soybean industry, the crush refers to both the physical process of converting soybeans into oil and meal and the difference in value of the soybeans to that of those products.

The Board Crush is a facilitated spread, considered a gauge of the potential profit margin for soybean processors and is available for easy and efficient execution on CME Globex.

Mechanics and Pricing

Some trade the soybean crush using a 1:1:1 ratio of Soybean, Soybean Meal, and Soybean Oil futures contracts.  However, given the difference among contract sizes, this method isn’t weighted appropriately according to the yield of meal and oil from soybeans.  To more precisely weight each component, the exchange facilitates the board crush that consists of a total of 30 contracts; 10 Soybean, 11 Soybean Meal, and 9 Soybean Oil.

Crush Calculation

[(Price of Soybean Meal ($/short ton) x .022) + Price of Soybean Oil (¢/lb) x 11] – Price of Soybeans ($/bu.)

Key Benefits

  • Execute in a single trade on CME Globex – lower risk
  • Margin Offsets
  • Precise hedge

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