August 29, 2007

Argentina's July soy crush falls more than 8 percent

Soy crushers in Argentina processed 2.8 million tonnes of soybeans in July, down 8.2 percent from the same month last year amid energy restrictions on factories, the Agriculture Secretariat said on Monday (August 27).

However, in the first seven months of the year, processing of the oilseed rose to 19.07 million tonnes from the 18.98 million tonnes that were crushed in the same period last year.

Industry analysts warned that the effect of government restrictions for power supply in Argentina would affect soy production. The country is the world's top exporter of soyoil and soymeal, and the third-biggest exporter of unprocessed beans.

The government's limited power supplies to the industry has pushed up domestic demand for natural gas as well as for electricity especially during the cold weather in the southern hemisphere winter.

July production was 536,923 tonnes of soyoil and 2.1 million tonnes of soymeal pellets, the secretariat said.

High prices for soy derivatives and low local production costs have been a major incentive for investment in crushing capacity in Argentina in recent years.

The Secretariat estimates that 2006/07 soy production will be 47.2 million tonnes.