• The USDA has released its monthly demand and supply projections for vegetable oils. The USDA raised its forecast for US soybean inventory for 2022E/2023F to 245mil from 230mil bushels. The upward revision was due to higher carryover stockpiles from the previous season and improved yields per acre. Comparing 2022E/2023F against 2021/2022E, US soybean output is estimated to inch up by 2.1% to 4,531mil bushels while US soybean inventory is expected to rise by 8.8% to 245mil bushels.

• The USDA also tweaked its forecast of world soybean inventory for 2022E/2023F to 101.4mil from 99.6mil tonnes. This was due to slightly higher stockpiles in the US and Argentina. The USDA forecast world soybean production to expand by 11.3% to 392.8mil tonnes in 2022E/2023F on the back of higher output in the US, Brazil and Argentina. World soybean inventory is envisaged to be 101.4mil tonnes in 2022E/2023F vs. 87.9mil tonnes in 2021/2022E.

• Bloomberg reported that potash prices in the US continue to fall despite Canadian producers saying supply will remain tight amid the war in Ukraine. New Orleans potash prices fell 1.4% in the week ending 12 August to the lowest level since February 2022. Belarusian potash has been mostly out of the market because of sanctions and many buyers avoided Russian supplies for fear of getting caught in international sanctions. In spite of this, fertiliser sales have so far escaped bans imposed on other Russian commodities and exports.

• Financial Express reported that the Indian government is aiming to reduce import dependence on palm oil by 25% to 30% through the production of 2.8mil tonnes of oil by 2030F under the National Edible Oil Mission. Currently, around 350,000 hectares of palm oil are under cultivation. Under the mission launched last year, additional areas of 650,000 hectares will be planted by 2025F/2026F. India’s annual palm imports account for 13 to 14mil tonnes, of which 8mil tonnes are imported from Indonesia and Malaysia.

• Bloomberg quoted the Solvent Extractors Association of India as reporting that the country’s soybean oil imports doubled MoM to 519,566 tonnes in July. Uncertainties over palm shipments from Indonesia prompted traders and refiners to boost purchases of soybean oil from Argentina and Brazil. India’s palm purchases shrank to 530,420 tonnes in July from 590,921 tonnes in June.

Source: AmInvest Research - 22 Aug 2022