December 17, 2019
Abiove - Brazil and China governments finalising protocol for soymeal exports
André Nassar, Abiove president, an oilseeds industry group said authorities from both countries are finalising a health standards protocol aimed at domestic processors for Brazil soymeal exports to China, reported Reuters.
The new health guidelines will mean Brazilian companies can export soymeal and compete with China-based soy processors, which is currently impossible.
The new protocol comes as Brazilian processors must increase local blending, by first increasing crushing to create additional biodiesel. This results in an added soymeal output, and this byproduct will need new purchasers.
Nassar said soybeans are exported raw rather than as soymeal, and the industry would like a balance of both.
He also said China and other meat-producing countries use soymeal as livestock feed, and there's anticipated demand in China with the swine stocks steadily restored after the African swine fever outbreak.
Abiove said in 2019, 43 million tonnes of Brazil soybeans are projected to be processed. It is predicted to grow to 9 million tonnes by 2023 with the government increasing the required biofuel quantity to be blended into diesel by 15%. It is currently 11%.
While no dates for the implementation of the health protocol for soymeal export have been announced, Nassar said authorities in Brazil are currently in advanced talks to finalise the protocol. A similar protocol for the export of Brazil cotton meal to China has already been implemented.
Nassar added that China will not halt purchases of Brazil soybeans once the health protocol for soymeal export is ready.
8 million tonnes of Brazil soymeal is purchased by the European Union, with Brazil's soybean exports projected to reach 72 million tonnes in 2019. Abiove said China accounts for 80% of Brazil exports.