Brazil must increase its soybean crushing by 20pc until 2023 to meet the expected higher domestic biodiesel demand as the biofuel's blend into conventional diesel is set to rise in the coming years.
Soybean crushing in Brazil is poised to reach 44mn metric tonnes (t) next year, from 42.9mn t in 2019, and needs to increase by around 9mn t until 2023 to supply all the biodiesel sector needs, Brazilian soy crushers association (Abiove) said today.
Soyoil is the main raw material for biodiesel production in Brazil, accounting for nearly 75pc of the total, according to Abiove.
Currently diesel sold in Brazil contains 11pc biodiesel and is known as B11. This blend is scheduled to rise to 12pc (B12) by March 2020 and reach 15pc (B15) in 2023, a Brazilian effort to reduce greenhouse gas emissions as well as diesel imports.
Abiove forecasts Brazil will harvest 122.8mn t of soybeans next year, from 117.8mn in 2019. Exports are pegged at 75mn t by the association, also higher than the 72mn seen this year.
Brazil is the top global soybean exporter and is expected to surpass the US as the largest producer in the current season. US fields were affected earlier this year by unfavorable weather during planting.
Abiove also said it is important to boost the soymeal market, either domestically or abroad. The animal feed ingredient is expected to face stronger competition in the future due to the expanding Dried Distillers Grains (DDG) sector, thanks to the booming corn-based ethanol industry in Brazil.
By José Roberto Gomes
