February 5, 2007
ASA weekly: End of subsidy for wealthy US producers; Brazil's biodiesel expansion may limit soy exports
US President George W Bush's administration last week proposed ending farm subsidies for wealthy individuals as part of a plan that would close loopholes and cut traditional farm programmes by US$4.5 billion over the next 10 years.
Debate on the new legislation comes at a time of major changes in agriculture. Corn prices have risen to near-record levels due to booming ethanol demand. US trade partners want the US to curb crop subsidies that are said to promote overproduction here and low prices for farmers abroad.
The administration's plan appeared to be an attempt to parry complaints from US trading partners while broadening political support in Congress for reforms.
The USDA faces a tough fight in Congress this spring, with an especially stiff challenge to the provision eliminating payments to wealthy producers. Under the proposal, subsidies would go only to growers who make less than US$200,000 in adjusted gross income. This would affect those 71,800 farmers of the two million who declared farm income in 2003.
Meanwhile, lawmakers from agricultural states continue to push the case for alternative fuels, a fact highlighted in President Bush's State of the Union message.
Some lawmakers have introduced legislation to raise the renewable fuels standard to 60 billion gallons of ethanol and biodiesel by 2030.
Senate Agriculture chairman Tom Harkin (D-Iowa) said such efforts would require huge investments and new research efforts will hopefully be added into the new farm bill.
Senator Richard Lugar (R-Ind.) predicted there would be a new variable tax incentive for production of alternative fuels that would fluctuate depending on the price of oil.
Brazil's demand for biodiesel may limit soybean exports
Brazil's biodiesel demand could limit the country's soybean export capacity in 2007-08, according to a report from Dow Jones Newswires.
If soyoil demand moves above 250,000 tonnes in 2007-08, then the country's soybean exports would likely decline as local companies turn to crushing more soybeans for the domestic biodiesel market, said the Brazilian Association of Vegetable Oil Industries (Abiove).
Brazil's biodiesel industry is expanding as local producers gear up production before a mandatory 2-percent mix of the biofuel in all diesel fuel goes into effect in Jan 2008.
First Asian rust of season in Argentina
Argentina reported its first case of Asian rust last week in the Entre Rios province. Last season, Entre Rios' first occurrence of Asian soybean rust was not until Mar 29 when most of the soybeans were in the late stages of filling with harvest underway.
Currently, Entre Rios soybeans are more vulnerable to damage given that much of soybeans are in the flowering stage of development.
US & 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 |
12,214 |
2,434 |
514 |
379 |
3,400 |
1,440 |
640 |
|
Production |
85,013 |
83,368 |
87,196 |
39,000 |
40,500 |
41,300 |
53,000 |
55,000 |
56,000 |
|
Imports |
152 |
92 |
109 |
708 |
900 |
950 |
353 |
86 |
100 |
|
Crush |
46,160 |
47,320 |
48,444 |
29,560 |
32,600 |
33,700 |
29,730 |
28,000 |
27,300 |
|
Exports |
30,011 |
25,778 |
31,161 |
10,548 |
7,400 |
7,000 |
22,798 |
25,550 |
26,700 |
|
Other |
5,093 |
5,108 |
4,531 |
1,520 |
1,535 |
1,536 |
2,785 |
2,336 |
2,024 |
|
Usage |
81,264 |
78,206 |
84,136 |
41,628 |
41,535 |
42,236 |
55,313 |
55,886 |
56,024 |
|
Carryout |
6,960 |
12,214 |
15,383 |
514 |
379 |
393 |
1,440 |
640 |
716 |
|
Soymeal |
thousand tonnes | ||||||||
|
Carryin |
191 |
156 |
290 |
1,350 |
1,187 |
2,165 |
870 |
640 |
856 |
|
Production |
36,936 |
37,413 |
38,478 |
23,347 |
26,101 |
26,548 |
22,928 |
21,874 |
21,435 |
|
Domestic use |
30,446 |
30,194 |
30,935 |
537 |
573 |
602 |
9,162 |
9,556 |
9,511 |
|
Net Exports |
6,525 |
7,085 |
7,561 |
22,973 |
24,550 |
25,800 |
13,996 |
12,102 |
12,220 |
|
Usage |
36,971 |
37,279 |
38,496 |
23,510 |
25,123 |
26,402 |
23,158 |
21,658 |
21,731 |
|
Carryout |
156 |
290 |
272 |
1,187 |
2,165 |
2,311 |
640 |
856 |
560 |
|
Soybean oil |
thousand tonnes | ||||||||
|
Carryin |
488 |
771 |
1,346 |
660 |
542 |
712 |
293 |
248 |
450 |
|
Production |
8,781 |
9,250 |
9,124 |
5,404 |
6,228 |
6,397 |
5,708 |
5,352 |
5,233 |
|
Domestic use |
7,910 |
8,169 |
8,709 |
408 |
433 |
563 |
3,059 |
3,168 |
3,205 |
|
Net exports |
588 |
506 |
542 |
5,114 |
5,625 |
5,950 |
2,694 |
1,982 |
2,180 |
|
Usage |
8,498 |
8,675 |
9,251 |
5,522 |
6,058 |
6,513 |
5,753 |
5,150 |
5,385 |
|
Carryout |
771 |
1,346 |
1,219 |
542 |
712 |
596 |
248 |
450 |
298 |
USDA Export Sales (tmt) - Week of 25 January 2007
|
New |
Accum. |
|
|
|
New |
Accum. | ||
|
Country |
Commodity |
Sales |
Exports |
|
Country |
Commodity |
Sales |
Exports |
|
Canada |
Soybeans |
7.7 |
74.7 |
|
Ecuador |
Soymeal |
25.4 |
5.4 |
|
China |
Soybeans |
177.2 |
6688.3 |
|
Indonesia |
Soymeal |
0.4 |
22.2 |
|
Egypt |
Soybeans |
63.3 |
444.3 |
|
Japan |
Soymeal |
10.2 |
126.3 |
|
Finland |
Soybeans |
2.3 |
2.3 |
|
Mexico |
Soymeal |
17 |
429.5 |
|
Japan |
Soybeans |
74.6 |
1186.1 |
|
Philippines |
Soymeal |
17.1 |
136.4 |
|
Mexico |
Soybeans |
136 |
1563.1 |
|
Salvador |
Soymeal |
4.6 |
42.3 |
|
Netherlands |
Soybeans |
7.8 |
835.3 |
|
Trinidad |
Soymeal |
2 |
11.2 |
|
Panama |
Soybeans |
2 |
2.5 |
|
Canada |
Soyoil |
1.4 |
8.9 |
|
Portugal |
Soybeans |
59.3 |
185.7 |
|
China |
Soyoil |
26 |
108.7 |
|
Spain |
Soybeans |
6 |
304 |
|
Guatemala |
Soyoil |
0.8 |
11.3 |
|
Syria |
Soybeans |
14.9 |
160.2 |
|
Mexico |
Soyoil |
5.7 |
29.1 |
|
Taiwan |
Soybeans |
32.9 |
873 |
|
Nicaragua |
Soyoil |
2 |
5.9 |
|
Thailand |
Soybeans |
0.5 |
464.3 |
|
Salvador |
Soyoil |
1 |
6.3 |
|
UAE |
Soybeans |
2.3 |
176.4 |
|
Export Sales Totals (tmt) | |||
|
UK |
Soybeans |
26 |
36.7 |
|
|
Outstanding |
Accum. |
New |
|
Vietnam |
Soybeans |
0.6 |
1.5 |
|
Commodity |
Sales |
Exports |
Sales |
|
Belize |
Soymeal |
0.4 |
1 |
|
Soybeans |
6,778.00 |
16,120.20 |
677.6 |
|
Canada |
Soymeal |
52.6 |
440.8 |
|
Soymeal |
1,925.40 |
2,107.60 |
160.5 |
|
Dom. Rep. |
Soymeal |
9.5 |
131.3 |
|
Soyoil |
101.4 |
250.9 |
37.3 |
