December 11, 2007

 

ASA weekly: Biotech-free soy from US to cost more next year
 

 

Soy farmers will demand higher premiums on non-genetically engineered soy next year.

 

Increased premiums would raise costs for major biotech-free soy importers like Japan.

 

Dan Duran, CEO of the US Soybean Export Council, said aside from demanding higher premiums, soy farmers would also likely supply only the crops under contract.

 

Duran noted during an interview in Tokyo that US farmers are planting fewer acres of non-biotech soy that are more expensive to produce and lower-yielding than genetically engineered varieties.

 

Japan and other Asian buyers for non-biotech soy, such as Taiwan and South Korea, will have to expect price increases by next year.

 

Duran further explained that there is no guarantee that there would be product available on the spot market since without contracts, there is no clear assurance of availability.

 

China expected to increase soyoil imports on 2007-08

 

China's soy crushing industry is not capable of meeting the heightened demand; thus soyoil imports are expected to peak in 2007-08 season, an industry analyst said.

 

Oilseeds analyst, Oil World, stated that China's October soyoil imports in the 2007 to September 2008 season will rise to 2.8 million tonnes from 2.4 million tonnes last season due to a surge in demand and the inability of the domestic producers to keep up.

 

Recently, the Chinese government urged the industry and trade to step up imports in order to raise domestic supplies.

 

There were recent large-scale purchases of palm, soy and rapeseed oils but prices have not come down from the current high levels yet.

 

China's imports of soyoil rose rapidly in the past two years due to its growing population and booming economy.

 

The 2.4 million-tonnes of the commodity imported last season was up 58 percent from the 2005-06 season total of 1.51 million tonnes.

 

Asian traders anticipate China to extend the reduced import duty of 1 percent on soy and lower its tax on soyoil imports.

 

It is also expected that China would exempt imports of soy and soyoil from the 13 percent value-added tax as the government steps up soy imports to curb domestic price inflation.

 

China imported 2.85 million tonnes of soy in October and 24.54 million tonnes in the first 10 months of the year - a 4.5 percent increase on-year, according to General Administration of Customs.

 

Li Honglei, analyst at Nanhua Futures, said the growth rate for soy imports have reached their highest level since 2004 due to reduced domestic soy output.

 

Li also pointed that soy prices are likely to continue their ascent, despite the fast growth in imports, due to high international prices.

 

Biodiesel Industry Usage Of Soyoil Continues To Drop

 

Census fats and oil report indicated that the biodiesel industry's usage of soyoil dropped further to 107,000 tonnes in October from 127,000 tonnes in September.

 

Biodiesel margins continue to erode, as soyoil futures have not retreated to the extent that petroleum futures have in the past couple of weeks.

 

Census also revised October soyoil stocks 7,260 tonnes higher to 1.38 million tonnes.

 

U.S. & South America Soybean/Products Balance
	United States			Argentina			Brazil
	Actual	Estimate	Proj.	Actual	Estimate	Proj.	Actual	Estimate	Proj.
	2005/06	2006/07	2007/08	2005/06	2006/07	2007/08	2005/06	2006/07	2007/08
Soybeans	thousand tonnes
Carryin	6,960	12,229	15,589	174	334	2,814	1,638	2,252	2,578
Production	83,368	86,770	70,605	40,500	47,200	47,000	57,000	59,000	62,000
Imports	92	246	163	1,013	2,100	2,100	40	60	100
Crush	47,324	49,160	49,669	32,748	35,600	38,750	28,756	30,000	29,400
Exports	25,579	30,428	26,535	7,130	9,700	10,300	24,770	25,800	30,400
Other	5,288	4,068	4,447	1,475	1,520	1,620	2,900	2,934	2,950
Usage	78,191	83,656	80,651	41,353	46,820	50,670	56,426	58,734	62,750
Carryout	12,229	15,589	5,706	334	2,814	1,244	2,252	2,578	1,928
Soymeal	thousand tonnes
Carryin	156	285	319	1,686	1,996	1,696	640	794	754
Production	37,416	39,028	39,357	25,582	27,718	30,425	22,300	23,160	22,755
Domestic use	30,114	31,106	32,024	574	618	645	10,073	10,700	11,220
Net Exports	7,173	7,888	7,380	24,698	27,400	29,764	12,073	12,500	11,620
Usage	37,287	38,994	39,404	25,272	28,018	30,409	22,146	23,200	22,840
Carryout	285	319	272	1,996	1,696	1,712	794	754	669
Soybean oil	thousand tonnes
Carryin	771	1,366	1,321	385	484	519	248	300	286
Production	9,248	9,291	9,396	6,169	6,810	7,400	5,521	5,760	5,641
Domestic use	8,146	8,492	9,117	405	465	750	3,172	3,390	3,500
Net exports	507	844	685	5,665	6,310	6,670	2,297	2,384	2,192
Usage	8,653	9,336	9,802	6,070	6,775	7,420	5,469	5,774	5,692
Carryout	1,366	1,321	915	484	519	499	300	286	235

 

USDA Export Sales (tmt) - Week of 29 November 2007
Country	Commodity	New Sales	Accum. Exports		Country	Commodity	New Sales	Accum. Exports
Belgium	Soybeans	4.70	165.40		Indonesia	Soymeal	1.10	21.10
Canada	Soybeans	3.50	94.90		Japan	Soymeal	9.40	37.10
China	Soybeans	351.70	3527.30		Mexico	Soymeal	14.80	197.30
Egypt	Soybeans	60.00	204.60		Morocco	Soymeal	4.50	44.60
France	Soybeans	43.00	43.00		New Zealand	Soymeal	5.00	0.00
Guatemala	Soybeans	2.00	4.70		Nicaragua	Soymeal	3.40	9.80
Indonesia	Soybeans	38.00	331.80		Philippines	Soymeal	13.10	199.20
Italy	Soybeans	23.90	73.90		Salvador	Soymeal	5.90	21.60
Japan	Soybeans	54.00	777.30		Algeria	Soyoil	7.30	17.30
Netherlands	Soybeans	123.50	387.90		Canada	Soyoil	0.90	5.40
Spain	Soybeans	58.00	102.60		Malaysia	Soyoil	2.00	0.00
Taiwan	Soybeans	11.20	450.60		Mexico	Soyoil	1.90	36.40
Turkey	Soybeans	15.20	149.50		Morocco	Soyoil	6.30	16.30
Vietnam	Soybeans	0.90	15.60		Tunisia	Soyoil	5.70	5.70
Algeria	Soymeal	0.40	9.90
Canada	Soymeal	15.70	225.80
Colombia	Soymeal	9.30	59.70		Export Sales Totals (tmt)
Cuba	Soymeal	32.00	29.00		Commodity	Outstanding Sales	Accum. Exports	New Sales
Dom. Rep.	Soymeal	27.10	104.70		Soybeans	9,797.10	8,380.00	803.80
Honduras	Soymeal	2.50	22.30		Soymeal	2,010.80	1,270.80	163.50
Hong Kong	Soymeal	0.40	5.50		Soyoil	202.70	110.40	41.00