Joe Victor is a Business Development Specialist with Minneapolis Grain Exchange, Inc., where he monitors cash grain activity and cash grain opportunities. He provides marketing advice through this blog.
Soybean Crush and Exports
Feb 04, 2010
Allendale Inc will begin with the US soybean crush and finish with exports. These two main users of annual soybean production account for 92.3% of annual production. The soybean crush into soybean meal and soybean oil account for 50.9%. As you are able to view via this chart
, soybean crush for the 2009/10 market year is running very strong. At Allendale Inc, we analyze the “US Census Bureau” as well as “The National Oilseed Processors Association” and the crusher margin. We need to make note that NOPA as a members association runs about 6 million bushels per month lighter than the US Census Bureau. As we continue to explain to the major wire services, it may produce good news to write about China switching US purchased soybeans to South America (4 million bushels), but make sure you include the need for USDA to increase its US soybean crush target by 53 million bushels in response to the 2009/10 soybean crush target of 1.71 billion bushels.
Allendale Inc does include and makes available to its subscribers the “Soybean Gross Crush Margin,” which has been very profitable dating back to mid 2009. This profitability to crush soybeans into meal and oil remains strong but we do need to consider Brazil, Argentina and surrounding countries. Of course you do know ADM and Bunge as well as others are crushing oilseeds outside of the US.
Allendale Inc is not surprised when it comes to soybean exports. The best news is how we have filled the needs of our largest customer (China). Take a look at another chart
we update weekly for our customers, the weekly “Soybean Export Sales.” Allendale Inc fully anticipates its No. 1 export customer, China, will transition to South America as new supplies become available. Allendale Inc fully understands how this 40.9% demand remains strong for the first and second quarter and notably trails off the balance of the year. The question remains, how does this export action, crush and South America impact your bottom line?
Allendale Inc will cover the fundamental, technical and strategies you can choose from in a meeting near you. It is time for you to pick up the phone and register for a meeting.
We welcome your questions and comments.........Joe Victor
Allendale Inc welcomes any questions you may have by calling 800-551-4626 or
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