Bloomberg reports that an increased demand for biofuel and feed has resulted in surging export volumes for US soybean meals, leading to an expansion of the domestic bean crushing industry.
Soybeans are mainly used for manufacturing soybean oils for cooking and soybean meals, which are rich in protein and frequently fed to livestock including pigs, chickens, and dairy cattle. Last week, US export of soybean meals reached its highest volume since September 2020.
In addition, the rate of soybean crushing in the US also reached a record high in December, as this manufacturing process yields powders used for various purposes such as animal feed, cooking oil, and fuel.
Judging from current circumstances, it would not be unreasonable to surmise that, as an increasing number of oil refineries enter the green diesel market, soymeal production in the US will likely undergo massive growth in the coming years. Furthermore, as more and more factories prioritize soybean oil in their fuel production, soymeal prices may in turn become suppressed, thereby making the US more competitive in this market than Argentina, the largest soymeal exporter.
The US has sold soymeal in great quantities to such Asian countries as the Philippines. Compared to soybean oil, soymeal is even more difficult to be shipped from ports that specialize in shipping grains such as corn as soymeal’s unique structure makes it prone to clumping. This, along with the soymeal merchandises’ propensity to idle on store shelves, places increased pressure on both sales and consumption.
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