- According to news reports, India has removed the excise tax on the feedstock for biodiesel. There is no tax on biodiesel but a 12.5% tax was charged on the raw materials for biodiesel previously. With the removal of the excise duty, biodiesel manufacturers in India would be more profitable and they would be able to source feedstock from different suppliers. The diesel industry in India is estimated at about 25bil gallons per year (92.9mil tonnes) and a B20 blend would result in a biodiesel market of about 5bil gallons (18.6mil tonnes). Currently, India has biodiesel production capacity of 250mil gallons per year (929,324 tonnes).

- Soybean prices fell before rebounding last week on positive export data. Earlier in the week, soybean prices had declined as rains in Brazil are expected to boost production. Bloomberg quoted an industry expert as saying that as much as 2.5 inches of rain had reached 90% of planted areas in the country last week and more showers are expected this week. The rains are anticipated to improve soil conditions for plantings.

- Bloomberg also reported that it has been faster for US soybean farmers to transport their products on railway this year as the grains no longer have to complete with coal and oil shipments. In addition, none of the grains have been behind schedule as BNSF has laid a second set of rail track in North Dakota and spent more on signals to speed up trains. With improved shipments, discounts paid to soybean farmers have declined and the costs have dropped for overseas buyers.

- It was reported that 99% of the fires in Sumatra were intentional while in Java, the fires were accidental. A government official was also reported as saying that 2.09mil ha of land in Indonesia has been burnt from 1 July to 20 October 2015. About 20% of the fires occurred in timber forests while another 20% occurred on plantation land. Indonesia expects improving rainfall to douse the fires by end-November or early-December.

- Indonesia may reclaim unused land concessions from forest fire areas. An industry expert said that although Indonesia has ratified a regional agreement to reduce haze caused by land fires, the law has not been enacted locally in the districts. The expert also said that an initial investment of US$10mil to US$20mil would help the Indonesia government implement the law in the various provinces in Sumatra and Kalimantan. Jakarta Globe quoted an Indonesian minister as saying that although revisions to the environmental law must be made, a designated taskforce on haze is unnecessary.

- Under the 2009 Law on Environmental Protection and Management in Indonesia, companies are allowed to burn two hectares of land to clear land.

- SGS said that Malaysia’s palm oil shipments fell by 8.4% in the first 25 days of October compared with the same period in September. Palm oil shipments to China declined by 37.7% while India and the US received 5.5% and 64.7% more palm oil products respectively.

Source: AmeSecurities Research - 2 Nov 2015