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U.S. Soybean Oil Exports Forecast at Record Low
16.02.2023 08:13 "Agro Perspectiva" (Kyiv) —
According to the report of the USDA Oilseeds: World Markets and Trade (February 2023), continuing a multi-year downward trend, U.S. soybean oil exports for MY 2022/23 are forecast at a record low of 318,000 tons. Domestic soybean production has risen over the past decade, supporting larger crush and soybean oil production which are both projected to reach record levels this year. However, strong U.S. domestic demand for soybean oil and high prices have diverted supplies away from the export market Historically, U.S. soybean oil exports were driven largely by the level of production and tracked closely with global trends. However, in recent years, the U.S. soybean oil market has experienced a redistribution among use categories. Strong federal and state policies have supported the increased use of soybean oil as a feedstock for biofuel production. The share of U.S. soybean oil production used for domestic industrial consumption is expected to reach 44 percent in MY 2022/23, compared to 25 percent a decade ago. Strong domestic demand has extended the premium for U.S. soybean oil compared to South American exporters, reducing its competitiveness on the global market. U.S. soybean oil prices have come down since reaching record highs in MY 2021/22, but the spread against Argentina and Brazil remains prohibitive to the export market. Looking forward, 2022/23 soybean oil prices are likely to continue to be buoyed by increasing biofuel production in both the United States and South America, as well as expected lower soybean production and crush in Argentina.
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