A decision to boost the blend of biodiesel into diesel from March 2024 will create additional internal demand for an estimated 5 million metric tons of soybeans and potentially cut Brazilian soybean and soyoil exports, according to analysts. “I believe we could see a reduction in Brazilian soyoil exports of between 0.8 to 1.0 million tons, which would leave us with a total [domestic] demand for soyoil between 0.2 million and 0.4 million tons greater than in 2023,” said Pedro Schicchi, grains and oilseeds analyst at hEDGEpoint Global Markets. Some 70% of Brazil’s biodiesel comes from soybeans after it is processed into soyoil. Brazil’s government this week boosted the mandatory biodiesel mix to 14% from a current 12%. That means Brazilian soy processors are expected to crush between 1 million and 2 million tons more soybeans in 2024 to cater to additional biodiesel demand, Schicchi said.
Sources: Reuters/Forbes/Datamar News