October 9, 2006

 

ASA weekly: Brazil's soy down; Another Doha for Latin America; soy storage rejected

 

 

In its first report of the 2007 harvest. the Crop Supply Department of Brazil's Ministry of Agriculture (CONAB) has placed soy planting intentions between 20.5 and 21.1 million hectares, a 5 to 8 percent reduction from its estimate of last season's area of 22.2 million.

 

In comparison, the USDAestimated the upcoming season's area at 21 million hectares, down 4.5percent from its estimate of last season's area of 22.0 million hectares.

 

CONAB put a production range for the upcoming soy harvest at 53.5 to 55 million tonnes, which would be 100,000 to 1.6 million tonnes larger than its estimate of last season¡¯s production of 53.4 million tonnes. CONAB is assuming a 2.61-tonne-per-hectare yield.

 

This forecast is slightly lower than USDA's forecast of 56 million tonnes, which would be one million tonnes above its estimate for last season's 55 million. The USDA is using a 2.67-tonne-per-hectare yield for the 2007 harvest.

 

Latin American nations move for another Doha round

 

The WTO, OECD and Inter-American Development Bank have scheduled an Oct 10 an 11 international conference on agriculture policies and trade in Latin America, to  take place in Buenos Aires.

 

Bringing together governments from across the region, international agriculture policy experts, trade negotiators as well as representatives of the food and farming industries, the conference  attempts to bridge some of the divisions that led to the breakdown of the Doha Development Round of trade negotiations earlier this year.

 

Meanwhile, US agricultural trade negotiator Dick Crowder says there is still "quiet work" going on relative to the Doha Round talks although, in an interview with the Council on Foreign Relations, Crowder would not commit to any timeline for completing the Round. "We've had a lot of deadlines this year and we've had a lot of timelines that we have not met," Crowder said. "My feeling is¡­we will have an agreement. It's not a question of if, but when."

 

US Department of Energy finds alternative fuel target unattainable

 

The Department of Energy (DOE) has said an ambitious goal set by Congress in 1992 to replace 30 percent of the nation's gasoline supply with alternative fuels by 2010 is unattainable, and the target date should be extended by 20 years to 2030.

 

According to DOE official Dana O'Hara, alternative fuels currently account for only about 3 percent of US on-road transportation fuel supply. O'Hara said the DOE does not expect the percentage to change by 2010.

 

The renewed emphasis on alternative fuels in recent years has been offset by increases in vehicle sales. It is obvious the country will not go from 3 percent to 30 percent within the next four years, O'Hara said.

 

USDA rejects emergency storage for soy

 

The USDA has approved temporary storage for 2006 crops of soy and rice, but rejected emergency storage for soybeans.

 

Explaining its decision, the USDA said: "Because the 2006 crop harvest is expected to exceed available commercial storage space in certain areas, FSA has taken actions to ensure adequate availability of storage space at harvest for producers seeking warehouse-stored marketing assistance loans for grain." "Because soybeans are more susceptible to weather, infestation and other deteriorating conditions than bulk grains, they are not approved for emergency storage space," USDA added.

 

WTO rules against EU biotech moratorium

 

The WTO has ruled in favor of the US, Argentina and Canada in their WTO case against the EU over its moratorium on approving agricultural biotech products and EU member-state bans of previously approved products.

 

The United States brought a WTO challenge in May 2003, after five years of delays by the EU in complying with WTO rules as well as its own procedures and the recommendations of its own scientists. The WTO report issued today is the longest in the history of the WTO, according to a statement issued jointly by USTR Susan Schwab and Agriculture Secretary Mike Johanns.

 

In addition to the EU's across-the-board moratorium on product approvals, the WTO case challenged product bans imposed by six EU members (Austria, France, Germany, Greece, Italy, and Luxembourg) on seven of the biotech crops approved by the EU prior to the adoption of the moratorium.

 

According to the statement, in each case, the panel upheld the US' claims that, in light of positive safety assessments issued by the EU's own scientists, the bans by member states were not supported by scientific evidence and were thus inconsistent with WTO rules.

 

U.S. & South America Soybean/Products Balance
	United States			Argentina			Brazil
	Actual	Estimate	Proj.	Actual	Estimate	Proj.	Actual	Estimate	Proj.
	2004/05	2005/06	2006/07	2004/05	2005/06	2006/07	2004/05	2005/06	2006/07
Soybeans	thousand tonnes
Carryin	3,059	6,960	15,502	1,657	810	673	3,400	1,535	1,147
Production	85,013	83,999	83,824	39,000	40,500	41,300	53,000	55,700	56,000
Imports	152	108	109	779	800	860	408	428	450
Crush	46,160	46,675	47,627	29,010	29,551	30,700	29,730	28,200	28,500
Exports	30,011	24,494	29,665	10,000	10,250	9,800	22,798	25,700	25,500
Other	5,093	4,396	4,326	1,616	1,636	1,652	2,745	2,616	2,324
Usage	81,264	75,565	81,618	40,626	41,437	42,152	55,273	56,516	56,324
Carryout	6,960	15,502	17,817	810	673	681	1,535	1,147	1,273
Soymeal	thousand tonnes
Carryin	191	155	227	1,350	877	594	753	896	546
Production	36,938	36,708	37,816	22,907	23,340	24,330	22,917	22,071	22,565
Domestic use	30,448	30,300	30,935	537	573	602	8,735	9,350	9,550
Net Exports	6,526	6,336	6,881	22,843	23,050	23,796	14,039	13,071	12,970
Usage	36,974	36,636	37,816	23,380	23,623	24,398	22,774	22,421	22,520
Carryout	155	227	227	877	594	526	896	546	591
Soybean oil	thousand tonnes
Carryin	488	771	1,265	660	542	431	293	128	126
Production	8,781	9,101	8,970	5,404	5,496	5,850	5,588	5,400	5,415
Domestic use	7,910	8,142	8,618	408	433	488	3,059	3,136	3,210
Net exports	588	465	519	5,114	5,174	5,400	2,694	2,266	2,200
Usage	8,498	8,607	9,137	5,522	5,607	5,888	5,753	5,402	5,410
Carryout	771	1,265	1,098	542	431	393	128	126	131

 

USDA Export Sales (tmt) - Week of 28 September 2006
Country	Commodity	New Sales	Accum. Exports		Country	Commodity	New Sales	Accum. Exports
China	Soybeans	570.80	459.30		Lebanon	Soymeal	3.60	18.90
Egypt	Soybeans	78.00	19.60		Mexico	Soymeal	5.20	1459.10
France	Soybeans	55.00	0.00		Panama	Soymeal	6.40	145.40
Indonesia	Soybeans	58.00	4.30		Syria	Soymeal	5.00	5.00
Israel	Soybeans	26.30	26.30		Hong Kong	Soyoil	0.20	15.90
Japan	Soybeans	25.50	142.80		Korea, Rep.	Soyoil	0.60	26.70
Mexico	Soybeans	61.60	316.00		OPAC Is.	Soyoil	1.00	1.00
Thailand	Soybeans	60.60	0.60
Turkey	Soybeans	7.80	105.50
Canada	Soymeal	5.90	1148.40		Export Sales Totals (tmt)
Dom. Rep.	Soymeal	8.50	388.20		Commodity	Outstanding Sales	Accum. Exports	New Sales
Honduras	Soymeal	5.20	134.50		Soybeans	8,592.10	1,436.90	1,488.90
Hong Kong	Soymeal	0.40	19.30		Soymeal	547.20	6,350.00	16.90
Korea, Rep.	Soymeal	0.50	5.10		Soyoil	31.50	348.90	0.60

 

Thursday Spot and Futures Prices, 05 October 2006
Item	Location	Sep	Dec	Jan
Soybeans ($/mt)	Central Ill./Chicago	207.78	213.11	216.69
	FOB Gulf (Basis)	229.83	238.46	238.37
	CIF Gulf Coast (Basis Chicago)	229.83	238.46	238.37
Board Crush Margin	$/mt	23.73	21.23	20.15
		Oct	Dec	Jan
Soybean Meal 48%, HiPro ($/mt)	Central Ill./Chicago	184.41	186.95	188.05
	FOB Gulf (Basis)	219.69	216.71	217.81
	West Coast (Basis)	241.73	244.27	245.37
Soybean Meal 44% ($/mt)	Central Ill./Chicago	184.41	186.95	188.05
	FOB Gulf (Basis)	208.67	205.69	206.79
	West Coast (Basis)	230.71	233.25	234.35
Soybean Oil, Crude ($/mt)	Central Ill./Chicago	525.14	530.43	539.69
	FOB Gulf (Basis)	552.69	557.98	567.24
		Beans	Meal	Oil
1 year ago prices	Chicago, $/mt	207.31	182.43	517.42