Crush Spread
The price difference between soybeans and their processed products (soybean meal and oil), representing the processing margin for soy crushers.
Crush Spread = (Meal Value + Oil Value) − Soybean Cost (per bushel equivalent)
The crush spread measures the profitability of crushing soybeans into soybean meal (used in animal feed) and soybean oil (used in food and biofuels). One bushel of soybeans (~60 lbs) yields approximately 44 lbs of meal and 11 lbs of oil (the rest is hull and moisture).
Soy processors (crushers) hedge their margin by buying soybean futures and simultaneously selling meal and oil futures. Traders use the spread to express views on crush economics — tight meal supply, biofuel demand, and seasonal crush capacity utilization.
The crush spread is quoted as the value of the products minus the cost of the beans; positive spread means crushing is profitable.
On the desk
Soybeans: $11.80/bu. Soybean meal: $350/short ton. Soybean oil: $0.52/lb. A 60-lb bushel yields ~44 lb meal and ~11 lb oil. Meal value = (44 ÷ 2000) × $350 = $7.70; oil value = 11 × $0.52 = $5.72; total product value = $13.42/bu. Crush margin = $13.42 − $11.80 = $1.62/bu — positive, so crushing is profitable and processors run hard.