20211213-USDA-Oil_Crops_Outlook__December_2021_9页_216kb

Oil Crops Outlook: December 2021 Summary

Core Content

The Oil Crops Outlook: December 2021 report from the USDA's Economic Research Service provides an analysis of the domestic and international outlook for oil crops, including soybean oil, rapeseed, and sunflowerseed. The report highlights changes in production, use, and trade forecasts, as well as the impact of market conditions and policy developments on these crops.

Domestic Outlook

Soybean Oil Production and Use

• Soybean Oil Extraction Rate: The extraction rate for soybean oil reached an all-time high in October at 11.92 pounds per bushel.
• USDA Forecast Update: The 2021/22 soybean oil extraction rate was raised from 11.66 to 11.75 pounds per bushel, leading to an increase in production estimates from 20.0 billion pounds to 25.7 billion pounds.
• Domestic Supply Increase: The total domestic supply of soybean oil is expected to be 28.32 billion pounds, nearly 155 million pounds higher than the previous month's forecast.
• Use Projections: Domestic use of soybean oil for food, feed, and other industrial purposes is raised to 14.15 billion pounds from 13.65 billion pounds, driven by higher alternative vegetable oils prices and reduced consumption of canola and cottonseed oils.
• Crush Volume: U.S. processors crushed a record 197 million bushels of soybeans in October, nearly 0.5 million bushels more than the previous October. This equates to 6.35 million bushels crushed per day.
• Soybean Oil Production: Soybean oil production increased by 21% from September to 2.35 billion pounds.
• Soybean Meal Production: Although soybean meal production increased by 19% to 4.6 million short tons, the average price forecast was raised by $5 to $330 per short ton.
• Crush Forecast: The 2021/22 soybean crush forecast remains unchanged at 2.19 billion bushels.
• Soybean Prices: The average soybean price forecast remains at $12.10 per bushel, while the soybean oil price is forecast at 65 cents per pound.

Biofuel Use

• Biofuel Production: The 2021/22 soybean oil use for biofuel is unchanged at 11 billion pounds, reflecting a 2.2 billion pound increase compared to the 2020/21 season.
• Renewable Diesel Growth: Renewable diesel production has surged, capturing a larger share of the biomass-based diesel market. It now accounts for 30% of the total market, with increased production capacity expected in 2022.
• Biodiesel Impact: Increased feedstock prices have led to a near 1:1 tradeoff between biodiesel (FAME) and renewable diesel production, with the latter gaining dominance.

International Outlook

Rapeseed Production and Trade

• Global Rapeseed Production: The 2021/22 global rapeseed production forecast was revised upward by 850,000 tons to 68.35 million tons.
• Australia's Record Production: Australia's rapeseed production is forecast to reach a new national record of 5.5 million tons, up 0.7 million tons from last month and 1 million tons from the previous year.
• Canadian Rapeseed Reduction: Canada's rapeseed production is reduced by 0.4 million metric tons, leading to a 400,000-ton decrease in exports, now projected at 5.3 million tons.
• Australian Exports: Australian rapeseed exports are revised up by 600,000 tons to a record 4.6 million tons, with Japan and the United Arab Emirates receiving the majority of the increased shipments.
• Canadian Stock Outlook: The reduced supply of rapeseed in Canada is expected to result in very tight season-ending stocks, assuming stable demand for crush.

Sunflowerseed Production and Use

• Global Sunflowerseed Production: The 2021/22 global sunflowerseed production is forecast at 57 million metric tons, up 7.9 million tons from the previous year.
• Russia and Ukraine Output: Output gains for Russia and Ukraine are primarily responsible for the increase, with Russia's crop raised to 15.5 million tons and Ukraine's to 17.5 million tons.
• Sunflowerseed Crush: The 2021/22 sunflowerseed crush is expected to total 14.15 million tons in Russia and 16.95 million tons in Ukraine.
• Sunflowerseed Oil Production: Global sunflowerseed oil production is forecast to reach 22 million tons, up 2.9 million tons from last year and 258,000 tons from the previous month's forecast.
• Exports: The additional sunflowerseed oil is primarily exported to China, the European Union, and Turkey, with some domestic consumption.

China's Soybean Production

• Soybean Production Forecast: China's soybean production forecast was reduced by 2.6 million tons to 16.4 million tons, due to lower sown area and less favorable profits compared to alternative crops.
• Harvested Area: Soybean harvested area fell to 8.4 million hectares from 2020/21, a 15% reduction or a net loss of 1.5 million hectares.
• Yield: Soybean yield is slightly lower at 1.95 tons per hectare.
• Crush Volume: Soybean crush is reduced by 1 million ton this month due to low margins.
• Annual Crush Forecast: The annual crush forecast is now 97 million tons.
• Domestic Use: Domestic meal and oil production are adjusted downward to 76.8 million metric tons and 17.4 million metric tons, respectively.
• Imports and Stocks: Soybean imports remain unchanged at 100 million metric tons, but ending stocks are reduced by 1.6 million metric tons to 34 million metric tons, making it the second-largest ending stock after last year.

Key Information

• Soybean Oil Supply: Increased by nearly 155 million pounds to 28.32 billion pounds.
• Renewable Diesel Growth: Expected to continue in 2022, with production capacity expansions and higher feedstock prices.
• Rapeseed Production: Australia's record production helps offset Canada's reduction, leading to higher global forecasts.
• Sunflowerseed Output: Russia and Ukraine's increased production leads to higher global sunflowerseed oil output.
• China's Soybean Outlook: Reduced production and crush due to lower profitability and sown area.

Conclusion

The report outlines a positive outlook for U.S. soybean oil production and use, driven by record crush volumes and higher extraction rates. Internationally, Australia's record rapeseed production and Russia and Ukraine's increased sunflowerseed output contribute to a more favorable global supply outlook. However, China's soybean production and crush are expected to decline due to lower profitability and sown area. The report also highlights the growing competition between biodiesel and renewable diesel, with the latter gaining significant market share.