• The USDA has released the acreage and grain stocks report. The USDA estimates corn planting areas to be 94.1mil acres in the US in 2023E. This is 6.2% higher than 88.6mil acres in 2022. In contrast, soybean planted areas are expected to decline by 4.6% to 83.5mil acres this year. Corn inventory in the US stood at 4,106mil bushels as at 1 June 2023 vs. 4,349mil bushels a year ago. Stockpiles of US soybeans dropped by 17.8% to 796mil bushels as at 1 June 2023 from 968mil bushels a year.

• Bloomberg reported that Bunge and Chevron Corp have acquired a seed business in Argentina. The 2 companies bought Chacraservicios, a company that focuses on Camelina Sativa – a cover crop that contains high levels of vegetable oils, which is key to the production of green diesel. The terms of the transactions were not disclosed. The deal comes as crop traders and energy companies seek to source low carbon feedstock to produce renewable diesel.

• China Dialogue reported that India’s palm oil drive is facing a reality check. Government responses to right to information requests by China Dialogue revealed that 14 out of 22 states slated for increased palm oil cultivation do not have mills to process fruits into palm oil and that palm oil expansion targets were not met in 2021/2022 and 2022/2023E. In the first year, only 72% of the 29,422ha expansion target was achieved while just 36% of the 2022/2023E target was met. Experts have also raised concerns over the climatic conditions of some of the target areas. For example, in the north-east, the government plans to rely on rainfall instead of irrigation.

• World Fertiliser reported that ICL has announced an update to its 2022 to 2024 framework agreement with its customers in China. ICL has agreed to supply customers with 800,000 tonnes of potash in 2023E with mutual options for an additional 350,000 tonnes. The agreed price is US$307/tonne, which is in line with recent contract settlements. Due to the lower-than-anticipated potash price, ICL expects to see a negative impact to its 2023E EBITDA guidance of US$400mil.

• Reuters reported that Indonesia plans to raise its palm-based biodiesel blending to 40%over the next few years. The CEO of Indonesia’s CPO fund agency said that the B35 mandate has not been fully implemented as there were issues with some blending facilities that need to be upgraded. The ministry is pushing for B35 to be fully implemented by 1 August. Energy Ministry official Edi Wibowo said that biodiesel consumption stood at 5.2mil kilolitres (4.5mil tonnes) as at 25 June. The target is 13.2mil kilolitres (11.5mil tonnes) for this year.

• MercoPress quoted the Brazilian Association of Vegetable Oil Industries as saying that soybean harvest in the country has exceeded expectations, leading to an upward revision in export forecasts for soybean/meal/oil. The association attributed the substantial crop yields to firm productivity across the country and acreage expansion. Brazil achieved a record harvest of 156mil tonnes this year, surpassing the forecast of 155mil tonnes. As such, the projection for soybean exports has been revised to 97mil tonnes compared to 95.7mil tonnes previously

Source: AmInvest Research - 10 Jul 2023