USDA Expects Record U.S. Exports To China In 2004-05

USDA estimates 2004-05 planted area to reach 30.4 million hectares with production of 85.5 million tonnes. This would support U.S. soybean exports of 28.4 million tonnes in 2004-05. The export estimate reflects record shipments to China and reduced competitor supplies, especially in Brazil, USDA said. Soybean crush could be 43.7 million tonnes, reflecting lower than previously expected domestic soybean meal disappearance. However, USDA believes this could be partly offset by higher prospective soybean meal exports. U.S. soybean ending stocks for 2004-05 are projected at 11.2 million tonnes, still the highest since 1986-87. However, soybean oil stocks could be lower in 2004-05 due to lower production and increased exports.

Global oilseed production for 2004-05 is projected at 386.5 million tonnes, 50.1 million tons above last year’s record, according to USDA. Global oilseed ending stocks for 2004-05 could be 62.4 million tonnes reflecting a lower than previously expected South American soybean crop. Also, lower prospective rapeseed exports for the EU could result in decreased global oilseed trade in 2004-05.

Global soybean production in 2004-05 could reach 224.1 million tonnes, up 19% from 2003-04, according to USDA. Global soybean stocks are projected to be a record at 56 million tonnes, 18.5 million tonnes above 2003-04. USDA also lowered Paraguay’s soybean crop forecast due to drought, but despite this and the Brazilian reduction world soybean production will still be up 19% on last season at 224.14 million tonnes, it said

Brazil Drought To Boost U.S. Soy Sales

Drought in Brazil will cut the size of the South American country’s soybean crop this year, opening opportunities for U.S. soy exporters on the global market and resulting in smaller world ending stocks, the USDA said last week. “ Brazil’s crop is projected at 59 million tonnes, down 4 million tonnes from last month, because of dry weather through early March in southern states, particularly Rio Grande do Sul, Parana and Mato Grosso do Sul,” USDA said. On March 7, Brazilian government forecasters estimated a 57 million tonne soybean crop this year, down 7% from their estimate in December 2004 (61.4 million tonnes).

Not only has the weather inflicted heavy crop losses on Brazilian farmers but it also has lowered the quality of the harvested beans. Hot and dry weather across the southern and southeastern Brazilian states has led to a higher-than-usual level of green soybeans. As a result, Brazilian exporters are rushing to set discounts for lots with over 10% of green beans from the current harvest, which is about 15% complete.

Soybeans turn green when exposed to extreme temperatures, such as have been seen across Brazil this summer, as a means of protecting themselves. The result is a low protein and the transformation of oil into fatty acids, according to Embrapa, the Brazil government’s crop research agency. If more than 10% of soybean lots are green beans, the resultant refined soyoil tends to be muddy-looking and soymeal protein levels tend to fall by more than 30 percent.

Indonesia Protests India’s Increased Import Tariff On Crude Palm Oil

Indonesia will file a WTO protest to India against import tariff rises on crude palm oil (CPO) products. The protest will be submitted by Indonesian Minister of Agriculture Anton Aprianto to his Indian counterpart before the World Trade Organization’s informal meeting of senior officials from the G-20 member countries scheduled in India on March 28, said Dedi Saleh, Chief the of Indonesian-Indian Cooperation Association.

“According to them, the rise of import tariffs is aimed at protecting Indian farmers. If that is the goal, the import tariff of soybean oil must also be increased, but not only the CPO. This is not fair,” Dedi said.

The Indian Finance Ministry raised the import tariff on CPO from 65 percent to 85% last week to protect the interests of its own CPO producers.

Pakistan Edible Oil Imports Likely To Increase

Pakistan’s edible oil imports are expected to rise by at least 7% in 2005 from 1.5 million tonnes last year as buoyant economic growth lifts domestic consumption, a senior government official said last week. “Local consumption will grow by about 7% and all of that will have to be met through imports,” said Faiz Ahmad, customs tariff secretary at Pakistan’s Central Board of Revenue. “Our domestic production is not expected to rise as farmers are shy of shifting to oilseed production. They are getting good returns from other crops such as cotton and wheat,” Ahmad said.

Peruvian Meal Imports To Rise

Increased demand from the poultry sector is expected to push Peru’s soymeal imports to 625,000 tonnes in 2005, an 8% increase over the 581,117 tonnes imported last year, according to USDA. Although demand for all feed ingredients is rising as poultry output increases, high fishmeal prices will encourage Peruvian poultry producers to use more soymeal in feed. Imports from the U.S. totaled 47,991 tonnes, significantly up on 6,348 tonnes the previous year.

With a per capita consumption of about 24 kilograms per year, chicken meat is a staple product in the Peruvian diet. Peru’s poultry population is about 320 million birds per year and the main user of soymeal, which constitutes about 12% of the broiler’s feed. Peru’s poultry production is expected to grow about 3% in 2005, according to the USDA.

Soy Complex Mostly Higher On Moderate Fund Buying

The soy complex closed higher on March 10 despite a new, higher USDA estimate of carryout. The market found support on moderate fund buying, which has pushed prices to the highest levels since early September. Meanwhile, U.S. and world soybean supplies look more than adequate for the time being, large enough to weigh heavily on soybean prices should fund buying abate. March bean futures closed up $3.40 finishing at $232.68; May was $3.58 higher, closing at $234.88 and July gained $3.31 ending at $236.26. March meal was up $3.75, closing at $204.04; May was $3.75 higher, finishing at $208.11 and July increased $3.09 to finish at $210.54. March oil closed $1.10 lower to finish at $519.18; May increased $0.44, closing at $521.61; and July gained $0.88, ending at $524.47.