May 1, 2009

US March soyoil reserves drop 0.6 percent on lower output

US March soyoil inventories fell 0.6 percent as processors including Bunge Ltd. reduced output and production of biodiesel declined, government data show.

Figures from the Census Bureau reveal that reserves slipped to 3.058 billion pounds at the end of March from 3.075 billion pounds a year earlier. Stockpiles increased 1.2 percent from a revised 3.023 billion pounds in February. Inventories were little changed from a preliminary forecast on April 23.

Anne Frick, a senior commodities analyst with Prudential Equity Group LLC in New York said there will be a lower usage for both edible products and biodiesel.

Consumption of soyoil in food products in March dropped 11 percent to 1.215 billion pounds from 1.358 billion pounds a year earlier. Usage was up 13 percent from February.

Refined oil production meanwhile dropped 15 percent to 1.196 billion pounds from 1.4 billion pounds a year earlier. Output rose 9.9 percent from the previous month.

Consumption of soyoil to make methyl esters that are used to mix with diesel fuel, plunged 64 percent to 82.9 million pounds in March from 230.2 million pounds a year earlier. Output tumbled 41 percent from February.

Soyoil futures for July delivery rose 0.54 cent, or 1.5 percent, to 35.73 cents a pound yesterday on the Chicago Board of Trade. Before today, the price tumbled 38 percent in the past year as demand slumped.

Soy is the second-biggest US crop, valued at US$27.4 billion in 2008, according to government figures. The corn crop, valued at US$47.4 billion, was the largest.