December 18, 2006

 

ASA weekly: US production estimate stable; Soybean oil in biodiesel production on the decline; Trans fat ban to be implemented in two steps; US agricultural exports reach all-time high

 

 

The USDA projects the total US oilseed production to be 97 million tonnes, down fractionally from the previous forecast due to a slight reduction in cottonseed.

 

The country's soybean production in 2006-07 is expected to reach 87.2 million tonnes, according to the USDA.

 

Global oilseed production for 2006-07 is projected at 395.5 million tonnes. Of note, USDA boosted its estimate for soybean production in Argentina to 42 million tonnes based on increased area as producers respond to higher prices.

 

Global oilseed crush is higher than previously forecast, reflecting higher soybean meal consumption, mainly in Brazil and Vietnam.

 

Also, biodiesel production declined in September and then further in October, according to Informa's analysis of Census Bureau data released this past week. This includes 143 million pounds of refined soybean oil used in the production of biodiesel during October.

 

The erosion appears to have discouraged biodiesel production just as biodiesel production capacity has increased from around 500 million gallons this summer to 700 million gallons currently.

 

The New York City Board of Health voted recently to eliminate the use of artificial trans fats in its restaurants. The ruling allows food products containing less than 0.5 grams of trans fat per serving to be considered to have zero grams of trans fat.

 

The new regulations will be implemented in two steps. By July 1, 2007, the city's restaurants must stop using oils, margarines and vegetable shortenings containing trans fats for deep frying foods.

 

Hydrogenated vegetable oils containing trans fats used to deep fry yeast dough and cake batter for foods such as donuts, cookies and cakes must be eliminated by July 1, 2008.

 

The move to reduce trans fat content to less than 0.5 grams per serving does not necessarily mean that the use of hydrogenated soybean oil is completely eliminated. It does at least portend a reduction in hydrogenated soybean oil in vegetable oil blends, which could include some soybean oil than has not been hydrogenated.

 

The US agricultural exports reached an all-time one-month high of US$6.9 billion in October, according to the USDA reports. The USDA says most of the increase comes from bulk products as soybean exports normally surge in the fall.

 

Soybean exports to China grew from about 500,000 tonnes in September to over 2.2 million tonnes in October, says the USDA.

 

Brazil's soybean exports may suffer with mandatory biodiesel blending

 

Brazil's exports of soybean and soy products could decline once the mandatory 2-percent blending of biodiesel comes into effect in 2008, according to a report in "The Public Ledger". To counter that, production will have to increase, says Ricardo Arioli Silva, administrative vice-president of the Association of Soybean Producers of Mato Grosso.

 

Meanwhile, Brazil's crop science institute, Embrapa reported 17 new cases of Asian soybean rust from December 8 through December 14, according to a report from Dow Jones Newswires.

 

The cases were reported in Mato Grosso do Sul, Rio Grande do Sul, Mato Grosso, Parana, Sao Paulo and Goais. So far this crop year, 63 discoveries of Asian soybean rust have been made.

 

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	12,214	2,434	514	379	3,400	1,440	640
Production	85,013	83,368	86,779	39,000	40,500	41,300	53,000	55,000	56,000
Imports	152	109	109	708	900	950	353	86	100
Crush	46,160	47,320	48,308	29,560	32,600	33,700	29,730	28,000	27,300
Exports	30,011	25,800	31,162	10,548	7,400	7,000	22,798	25,550	26,700
Other	5,093	5,103	4,520	1,520	1,535	1,536	2,785	2,336	2,024
Usage	81,264	78,223	83,990	41,628	41,535	42,236	55,313	55,886	56,024
Carryout	6,960	12,214	15,112	514	379	393	1,440	640	716
Soymeal	thousand tonnes
Carryin	191	156	272	1,350	1,187	2,165	870	640	856
Production	36,936	37,342	38,360	23,347	26,101	26,548	22,928	21,874	21,435
Domestic use	30,446	30,255	30,935	537	573	602	9,162	9,556	9,511
Net Exports	6,525	6,971	7,425	22,973	24,550	25,800	13,996	12,102	12,220
Usage	36,971	37,226	38,360	23,510	25,123	26,402	23,158	21,658	21,731
Carryout	156	272	272	1,187	2,165	2,311	640	856	560
Soybean oil	thousand tonnes
Carryin	488	771	1,374	660	542	712	293	248	450
Production	8,781	9,228	9,099	5,404	6,228	6,397	5,708	5,352	5,233
Domestic use	7,910	8,119	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	8,625	9,251	5,522	6,058	6,513	5,753	5,150	5,385
Carryout	771	1,374	1,222	542	712	596	248	450	298

 

USDA Export Sales (tmt) - Week of 07 December 2006
		New	Accum.				New	Accum.
Country	Commodity	Sales	Exports		Country	Commodity	Sales	Exports
Belgium	Soybeans	2.30	154.70		Hong Kong	Soymeal	0.90	5.60
Canada	Soybeans	0.80	57.60		Jamaica	Soymeal	55.00	23.90
China	Soybeans	469.70	4632.90		Japan	Soymeal	8.60	67.70
Cuba	Soybeans	60.00	57.00		Mexico	Soymeal	12.70	218.40
Germany	Soybeans	18.20	411.70		Nicaragua	Soymeal	1.20	11.80
Indonesia	Soybeans	82.30	458.40		Philippines	Soymeal	2.30	63.80
Japan	Soybeans	58.00	833.50		Salvador	Soymeal	27.10	14.50
Mexico	Soybeans	51.80	1120.60		Trinidad	Soymeal	11.30	2.20
Netherlands	Soybeans	150.3	647.20		Turkey	Soymeal	17.50	23.80
Philippines	Soybeans	1.70	16.40		China	Soyoil	0.50	20.00
Syria	Soybeans	40.00	145.30		Guatemala	Soyoil	0.70	7.40
Taiwan	Soybeans	30.70	534.60		Korea, Rep.	Soyoil	0.60	22.10
Thailand	Soybeans	60.00	258.70		Mexico	Soyoil	14.00	22.40
Turkey	Soybeans	17.20	264.40		Export Sales Totals (tmt)
Canada	Soymeal	13.50	267.00			Outstanding	Accum.	New
Dom. Rep.	Soymeal	15.30	95.30		Commodity	Sales	Exports	Sales
FW IND	Soymeal	2.10	3.50		Soybeans	6,897.60	10,916.40	903.40
Guatemala	Soymeal	14.70	88.00		Soymeal	2,036.90	1,182.70	205.50
Honduras	Soymeal	7.00	24.60		Soyoil	125.70	101.0	15.50