• The USDA (US Department of Agriculture) has released its latest demand and supply projections for vegetable oils. The USDA has reduced its forecast of 2020E/2021F US soybean inventory to 175mil from 190mil bushels due to higher crushing activities. Comparing 2020E/2021F against 2019/2020E, US soybean inventory is expected to fall to 175mil bushels from 523mil bushels. Although US soybean production is envisaged to expand by 17.4% to 4,170mil bushels in 2020E/2021F, soybean stockpiles are forecast to decline due to higher exports and low carry-over inventory from the previous season.
• Due to a lower estimate of US soybean inventory, the USDA has reduced its forecast of 2020E/2021F global soybean stockpiles to 85.6mil tonnes from 86.5mil tonnes. In terms of production however, global soybean output is envisaged to climb by 7.6% to 362.1mil tonnes underpinned mainly by the US.
• Bloomberg reported that the US Court of International Trade has upheld the US anti-subsidy duty rates on biodiesel imports from Indonesia. The court also approved the Commerce Department’s explanation on how it calculated the benefit Indonesian producers received in the form of cheap oil. In 2017, the Commerce Department determined that Indonesian biodiesel producers and exporters had benefited from unfair subsidies and the US began imposing duties. The duties were 64.73% for PT Musim Mas, 34.45% for Wilmar Trading Co and 38.95% for the other Indonesian exporters and producers.
• Reuters reported that a ship carrying 30,500 tonnes of US soybeans was unloading its rare cargo a few weeks ago at Paranagua, Brazil after receiving all regulatory permissions. There has not been any inbound cargo of soybeans at Paranagua in the past 10 years. Brazil, a net soybean exporter, sold so much of its soybeans to China that little were left to be processed internally during the inter-harvest period. A weak exchange rate had also contributed to this year’s export bonanza. The vessel was charted by Louis Dreyfus Co.
• Biofuels International said that US biodiesel producers are angry that a US blending deadline was missed. The US Environmental Protection Agency missed a deadline to announce how much renewable fuel refiners had to blend into their fuel mixtures next year. The president of the Renewable Fuels Association said that at this point, it makes more sense to let the new administration handle the 2021 RVO (Renewable Volume Obligations).
• Nikkei Asia reported that nine Japanese companies have declared that by the end of the year, all palm oil that they use will be certified by the RSPO (Roundtable for Sustainable Palm Oil). In 2015, about 37 Japanese companies were using RSPO-labelled palm oil compared with roughly 300 each in Britain and Germany. But the number has jumped to 221 due to strict procurements imposed on the organisers of the 2020 Tokyo Olympics. Japanese companies mostly use mass balance palm oil, which can entail transporting certified and uncertified palm oil that are mixed together.

Source: AmInvest Research - 14 Dec 2020