Biodiesel to Help Drive Soybean Consumption

d-goodBiodiesel looks to be one of the factors that will help consume the record amount of soybeans expected to be planted this year. This analysis from the University of Illinois’ Darrel Good says the expected 81.493 million acres of soybeans this year reflects a strong demand worldwide.

The USDA projects consumption of U.S soybeans and soybeans imported in to the U.S. during the current marketing year at 3.36 billion bushels, equal to the record consumption during the 2009-10 marketing year. Consumption is large in spite of continued high prices and back-to-back record production of soybeans in the rest of the world during the 2012-13 and 2013-14 marketing years. World consumption of soybeans during the current marketing year is projected at a record 9.884 billion bushels, 40 percent more than consumed 10 years ago. Much of the growth in world consumption has occurred in China, up 130 percent in 10 years. While it may not be reasonable to expect Chinese consumption to continue to grow at the pace of the past 10 years, there is no sign of a reversal in consumption. The U.S. should continue to have a large share of exports to China even with another large South American crop in 2015. Record high livestock prices and a likely increase in biodiesel production should keep domestic soybean consumption large as well.

But Good also points out that “intended” and actual “harvested” soybean numbers do vary every year.

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