USDA has released its monthly demand and supply projections for vegetable oils, raising the forecast for US soybean inventory in 2023/2024F by 12.5% to 315mil from 280mil bushels due to lower exports. Comparing 2023/2024F against 2022/2023, US soybean inventory is forecast to increase by 19.3% to 315mil bushels as a 13.7% fall in exports offset a 2.5% decline in production.
In spite of lower US soybean inventory, global stocks are anticipated to rise by 12% to 116mil tonnes in 2023/2024F on the back of higher production in Argentina. Soybean output in Argentina is estimated to double from 25mil tonnes in 2022/2023 to 50mil tonnes in 2023/2024F as yields recover from a drought. On the other hand, soybean production in Brazil is anticipated to ease by 3.7% to 156mil tonnes in 2023/2024F, dragged by unfavourable weather conditions.
Biodiesel Magazine cited the US Energy Information Administration as saying that total US biofuel operable production capacity was up slightly in November, with gains for ethanol. Total biofuels production capacity reached 23.8bil gallons per year in November 2023, up 108mil gallons per year from the previous month and up 1.7bil gallons per year compared to a year ago. Soybean oil consumption was at 1.1bil pounds in November, including 613mil pounds consumed by biodiesel plants and 449mil pounds consumed by renewable diesel plants.
Bloomberg reported that Ukraine’s agricultural exports from Odessa region seaports have reached 14.3mil tonnes since August 2023 when a new Black Sea shipping corridor was set up. Shipments in January 2024 were 6.3mil tonnes, almost on par with pre-war level with more than 100 vessels expected to approach seaports to export another 3mil tonnes.
India, which imports about 60% of its edible oils needs, targets to become self-reliant in the production of oilseeds. The programme will cover research on high-yielding varieties of crops such as mustard, peanuts, sesame, soybean and sunflower seeds, widespread adoption of modern farming techniques, market linkages, procurement, value additions and crop insurance. The government will also launch a comprehensive programme to help dairy farmers boost milk productivity.
Bloomberg said that the biggest US corn farmers’ group is urging the Biden administration to embrace biofuels in a push to reduce vehicle emissions rather than focusing mostly on electric cars. The administration has set a goal to make half of all new car sales to be electric by the end of the decade and has touted investments in EV technologies and infrastructure. More than one-third of corn grown by US farmers is distilled into ethanol under a government programme known as the Renewable Fuel Standard. Ethanol makers and the American Petroleum Institute are pushing for legislation that would allow more of the biofuel to be used in gasoline all-year round.
Wall Street Journal cited the Food and Agriculture Organisation of the United Nations as saying that food prices fell further in January as lower prices of cereals and meat more than offset the increase in sugar. Cereal prices fell 2.2% in January, driven by lower export prices for maize and wheat. Sharp price declines for maize reflected improved crop conditions and the start of the harvest in Argentina and large supplies in the US. Sugar prices were up 0.8% from December’s levels due to concerns over the potential impact of Brazil’s drier-than- normal weather conditions on sugar cane crops that will be harvested in April as well as favourable production outlook in Thailand and India.
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