Foreign media, August 30: The Brazilian Vegetable Oil Industry Association (ABIOVE) expects Brazil’s soybean production in 2022/23 to reach a record 151 million tons, an increase of 19.3% from the previous year’s production.
Soybean planting in Brazil will begin in September. Last year’s dry weather reduced Brazil’s soybean production in 2021/22 to 126.6 million tonnes, ABIOVE said. .
Andre Nassar, president of the ABIOVE association, said that with the prospect of record soybean production next year and uncertainty about prices and crushing profits, processors are cautious in purchasing and may not be as active as they were in early 2022.
ABIOVE expects soybean plantings in Brazil to increase to 42 million hectares in 2022/23, up from 40.9 million hectares in 2021/22.
Nassar said that even if the expected increase in soybean production is confirmed, the increase in soybean crush will not be as significant as the increase in production, but it will definitely increase. The association expects Brazil to crush a record 49.2 million tons of soybeans in 2023, up 1.2% from its forecast of 48.6 million tons in 2022.
Nassar said that the difference between 2022/23 and the previous year is that at the beginning of 2021/22, soybean crushing profits were better, but as soybean prices rose, crushing profits declined. He does not think that will be the case in 2022/23.
Brazilian crushers are currently cautious when purchasing soybeans. The pre-sale ratio of Brazilian soybeans for 2022/23 is about 12% due to uncertainty over the outlook for soybean prices.
In terms of soybean meal exports in 2022/23, Nassar said soybean meal exports could be very good, and China, a new buyer, will play an important role. Although China is not expected to buy in large quantities, it is also important to purchase in small batches. At the end of July, China opened its market to Brazilian soybean meal, which the Brazilian processing industry has been waiting for for a long time. Brazil has so far only sold soybeans to China, but the Brazilian crushing industry has been looking to expand exports of more value-added products.
In the case of soybean oil, Brazil’s soybean oil exports in 2022/23 could reach a record 2.2 million tons, considering Brazil is expected to gain a foothold in some export markets in the coming years. Major buyers of Brazilian soybean oil include India, China and Bangladesh. India and Bangladesh have a strong interest in diversified sourcing, and they have been actively communicating with Brazil. Brazil’s soybean oil exports to these markets remained high, in part due to blockages in Ukraine. Ukraine is the world’s largest supplier of sunflower oil. The Russian-Ukrainian conflict has affected Ukrainian sunflower oil production and exports, boosting Brazil’s share of the international soybean oil market.