Situation and Outlook
The 1997/98 world soybean production forecast at 152.3 million tons is unchanged in total from last month but reflects minor adjustments in Australia, Colombia, Mexico and South Africa. Forecast world soybean exports are increased with Brazil and Paraguay export estimates raised 1 and 11 percent, respectively. These changes more than offset the reduced U.S. export forecast resulting from weaker demand in Asia and anticipated stronger competition from South America. In addition, Canada's soybean export forecast is raised 80,000 tons to 700,000 tons. Global soybean imports are forecast higher supported by larger import estimates for Argentina, and Brazil as larger exportable supplies in Paraguay are imported for processing. A higher import forecast for Canada is made in response to strong early season imports. The Malaysian and Indonesian import forecasts are reduced again this month reflecting continued economic difficulties. The world ending stock forecast for September 1998 is raised due in part to larger U.S. ending stocks resulting from the lower export forecast.
Global soybean meal exports in 1997/98 are forecast at 35.4 million tons, down 500,000 tons because of a reduction in India's and Brazil's export forecast. Brazil is expected to continue its strong soybean export activities. India's soybean meal export projection is lowered based on weak demand for its lower quality meal. The soybean meal export forecast for the U.S. and Argentina is raised reflecting strong U.S. exports in February and larger Argentine exportable supplies from a larger crush estimate this month.
The world 1997/98 soybean meal import forecast is below last month's level at 35.4 million tons. Continued economic difficulties in Asia support a further reduction in Indonesia's soybean meal import forecast down 210,000 tons to 600,000 tons and 54 percent below last year's estimate. China's soybean meal import projection is below last month's level because of larger domestic soybean meal production. Japan's larger rapeseed import and crush forecast partially offsets the need for soybean meal imports resulting in a 100,000 ton reduction in Japan's forecast. With improving economic conditions in Colombia, the poultry industry is expected to increase activity and stimulate feed demand. Colombia's soybean meal import projection is raised 125,000 tons to 500,000 tons.
The global soybean oil export forecast for 1997/98 is
unchanged in total at 6.3 with an increase in the U.S. forecast
that is supported by strong demand and export activities over the
past months. Brazil's soybean oil export projection is lowered as
the result of reduced crush and expected growth in soybean
China's soybean crush was increased 607,000 tons in 1997/98 and 690,000 tons in 96/97 based on information from FAS Beijing that lead to a revision of the data series. The revision in the data series normalized food use consumption of soybeans, implying that fluctuations in availabilities will have the greatest impact on crush consumption. The feed/seed/waste residual was also reduced as much of the whole seed feeding has been converted to crush consumption. There is a corresponding increase in meal and oil production which has only a minor impact on import requirements for soybean meal.
Indonesia's poultry industry continues to struggle. Reports from Indonesia indicate that poultry producers are selling breeding stocks of chicken and hatching eggs as table eggs. Therefore, demand for soybean meal is falling rapidly. As such, soybean meal imports are reduced this month by 210,000 tons.
World oilseed production for 1997/98, excluding soybeans, was nearly unchanged in March at 131.3 million tons as an increase in world peanut production offset declines in sunflowerseed and rapeseed production. World peanut production for 1997/98 rose 630,000 tons this month to 27.6 million tons based on a revised production estimate for China. China's peanut production estimate was increased 800,000 tons to 8.8 million tons based on information provided through government sources and the media. Partially offsetting this increase was a 170,000 ton reduction in Senegal's 1997/98 peanut production estimate to 550,000 tons.
In India, the 1997/98 rapeseed production estimate was reduced 300,000 tons this month to 5.9 million tons contributing to a 276,000 ton decline in world rapeseed production to 33.7 million tons. The world sunflowerseed production forecast for March was reduced 289,000 tons to 23.9 million tons due to a lower production forecast for Argentina.
Forecast world exports of oilseeds, excluding soybeans, was also unchanged this month at 11.8 million tons. Reduced sunflowerseed exports from Argentina in response to the lower production estimate offset increased rapeseed exports from Canada. Rapeseed imports were also increased this month, primarily in China and Japan. The world other oilseed crush forecast for 1997/98 was also unchanged this month at 104.0 million tons. Increased rapeseed crush, primarily in the EU and Australia, offset reduced cottonseed crush in India. Ending stocks were unchanged at 3.3 million tons this month.
World protein meal production, excluding soybean meal, was unchanged this month at 57.5 million tons. Reduced fishmeal production in Peru due to the effects of El Nino was offset by an increase in world rapeseed meal production. Trade in protein meal, excluding soybean meal, was also reduced this month due to the reduction in world fishmeal production. Total world fishmeal trade was reduced 368,000 tons (exports) to a forecast 3.7 million tons. An additional decline in world protein meal exports was due to adjustments in world rapeseed meal trade estimates. Forecast world protein meal consumption, excluding soybean meal, rose 233,000 tons this month to 57.5 million tons as increases in world rapeseed and palm kernel meal consumption more than offset declines in fishmeal consumption.
World vegetable and marine oil production, excluding soybean oil, was increased 225,000 tons this month to 55.0 million tons as increased forecasts for palm, rapeseed, and peanut oil production offset a decline in fish oil production. Forecast vegetable and marine oil exports, excluding soybean oil, were up slightly to 22.0 million tons this month as increases in palm and palm kernel oil exports more than offset declines in other oils. On the import side, increased forecasts for rapeseed and coconut oil imports led to a 189,000 ton increase in forecast world oil imports to 21.8 million tons. Forecast oil consumption, excluding soybean oil, was increased 382,000 tons to 55.2 million tons. Increases were noted for rapeseed, coconut, and peanut oil. Forecast world ending stocks remained steady at 4.2 million tons in March.
Other Oilseed Highlights
India's rapeseed production estimate for 1997/98 was reduced by 300,000 tons to 5.9 million tons this month. The reduction is attributed to heavy rains during December and January in major rapeseed growing states which coincided with the flowering stage as well as cyclonic storms and hail in parts of Uttar Pradesh and Bihar during December. In addition, the 1996/97 rapeseed production estimate has been revised upwards by 642,000 tons as official data recently released put the 1996/97 crop at a new record of 6.9 million tons mainly due to a record area, estimated at 6.9 million hectares. The official data released also revised exports of soybean meal for 1996/97 downwards, indicating a stronger domestic demand than expected.
Peru's fishmeal production forecast for 1998 was reduced 295,000 tons to 1.5 million tons, compared to production of 1.7 million tons in 1997. This forecast is consistent with the recent announcement by the Fisheries Minister that the ban on anchovy fishing will remain in place at least until mid-April for Peru's central and northern waters. In Chile, the 1997 production was reduced 148,000 tons to less than 1.2 million tons while the 1998 forecast remains at 1.35 million tons. In general, the El Nino phenomenon will continue to adversely affect fishmeal production into 1998, leading to a 355,000 ton year-to-year reduction in fishmeal exports. In 1997, while fishmeal production felt the first impacts of El Nino, trade was supported by large stocks and exports from Peru. Currently, however, stocks are minimal in Chile and Peru.
China's 1997/98 peanut production (on an in-shell basis) was increased 800,000 tons to 8.8 million tons. While production is still down 1.3 million tons year-to-year, the increase this month is based on the assumption that the effects of the drought were less severe than previously determined.
Canada's rapeseed export forecast for 1997/98 was increased 330,000 tons this month to 2.8 million tons. Government trade estimates through February continue to show a strong export pace for Canadian rapeseed spurred by abundant supplies and a weakening Canadian dollar that has helped keep Canadian rapeseed competitive on world markets. The crush estimate was reduced 140,000 tons this month to 3.0 million tons despite continued strong crush volumes through February. The somewhat lower crush volume proposed this month reflects an expected downturn in crush later in the year in response to tighter seed supplies and reduced crush margins.
Argentina's sunflowerseed production forecast for 1997/98 was reduced 250,000 tons to 5.5 million tons in response to poor pollination and increased disease problems due to this season's wet weather. The reduced forecast is estimated to impact sunflowerseed crush and lower exports 200,000 tons from last month to 400,000 tons. The overall impact will be felt in the already tight global vegetable oil market.
The 1997/98 peanut production estimate for Senegal was reduced 170,000 tons to 550,000 tons in response to reduced plantings and lower yields resulting from tight supplies of high quality planting seeds and irregular rainfall. Senegal's domestic peanut consumption forecast was lowered to 320,000 from 430,000 tons as a result of the smaller crop.
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