WASDE maintains outlook for soybean oil use in biodiesel

By Erin Voegele | December 10, 2020

The USDA maintained its 2020-’21 forecast for soybean oil use in biodiesel in its latest World Agriculture Supply and Demand Estimates report, released Dec. 10. The forecast for soybean crush was increased, with the outlook for ending stocks lowered.

The forecast for soybean area harvested is unchanged at 82.3 million acres. The outlook for yield per harvested acre is also maintained at 50.7 bushels, while production is expected at 4.17 billion bushels. Soybean crush for 2020-’21 is increased 15 million bushels to 2.195 billion on strong crush margins and record early-season crush. With exports unchanged, soybean ending stocks for 2020-’21 are projected at 175 million bushels. If realized, ending stocks would be the lowest since 2013-’14.

Soybean and soybean product prices are forecast higher, with the U.S. season-average soybean price for 2020-’21 projected at $10.55 per bushel, up 15 cents. The soybean meal price is projected at $370 per short ton, up $15. The soybean oil price is forecast at 36 cents per pound, up 1.5 cents with cash prices reaching the highest level in the past six years.

An estimated 8.1 billion pounds of soybean oil expected to go to U.S. biodiesel production in 2020-’21, a forecast maintained from the November WASDE. An estimated 7.858 billion pounds of soybean oil sent to biodiesel production in 2019-’20, down from 7.863 billion pounds in 2018-’19.

Global soybean production is projected down 600,000 tons to 362.1 million. Higher soybean crops for Canada and Uruguay are offset by lower production for Argentina, which is reduced 1 million tons to 50 million on lower harvested area. Lower production for Argentina leads to lower crush and soybean meal exports, supporting higher U.S. exports. 

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