Soybean crush trading dashboards

Novitam Consultancy in cooperation with Cadran consultancy has develop position dashboards and underlying calculations for the Soybean crush trading process. This blog describes three of the main trading / position dashboards.

Soybean crush

Soybeans are processed into soybean meal and soybean oil through a process known as crushing. The crush spread is the difference between the value of soybeans and its byproducts, and is considered a gauge of the potential profit margin for soybean processors.

The Crush Spread

In a crush spread, the trader takes a long position in Soybean futures against short positions in Soybean Meal and Soybean Oil futures. This is also known as the board crush. The value of the crush equals the Soybean Oil futures price plus the Soybean Meal futures price, minus the price of Soybean futures. Soybeans, soybean meal and soybean oil all trade in different units:

  • Soybeans trade in bushels
  • Soybean Meal trades in short tons
  • Soybean Oil trades in pounds

So in order to perform an accurate calculation and position management, the prices of the three commodities need to be converted to a common unit.

Physical position

The phyiscal position consists of two parts:

  1. The purchase and sales positions per month securing the beans supply for the crushing plant and the sales of the refined products: Oil, Meal and Hull.
  2. The storage positions of the raw material and the refined products.

In the dasboard below the crush volume is set at 30K-Tons per month meaning that 30.000 tons of beans can be processed into approximately 22.500 tons of meal, 6000 tons of oil and 1000 tons of hull. The sales volume is determined by market demand and volumes can differ per month. A certain storage volume can secure both supply and demand and keep the plant operational and cost-efficient

Physical position dashboard

Financial position

One of the overviews displays the prognosed profit and loss per current and future month. Both purchase and sales contracts and costs associated with transportation and manufacturing are taken in account. Unpriced contracts are valued against forward market prices.

Financial dashboard

The dashboad allows the trader to change costs (what-if) and calculate the impact on the profitability. If required the trader can select different periods and be able to calculate his expected profitability on contract level.


Calculation of the M2M or unrealized P&L of the crush spread trading is done against CME prices. The M2M of physical and derivatives trading is combined in one dashboard. And parameters are added to do “what-if” analysis.

Mark2Market Dashboard

The position above shows an hedge position including physical contracts and future contracts. As explained in the introduction the Unit of Measures of the different commodities vary between commodities and also between different types of contracts.

Changing the forward prices by shifting the What-If parameters only has little effect on the overall M2M showing that the position is properly hedged against price fluctuations.

Beside physical and future contracts, Forex swaps, Option contracts and Inventory can be included in the dashboards.

Blog on Cadran Consultancy website