EU soybean meal imports hit a decade high in Q1 amid global crush surge: US FAS

The European Union's soybean meal imports hit a decade high, reaching nearly 6 million mt, in the first quarter of the marketing year 2024-25 (October-September), the US Foreign Agricultural Service said March 11.

The latest FAS oilseeds report also highlighted that soybean meal imports in the EU are forecast to reach a nine-year high of 17.6 million mt in the MY 2024-25. This represents an increase of 1 million mt from the previous estimate in February, according to the report.

The EU primarily sources its soybean meal imports from Brazil and Argentina, with additional supplies in recent years coming from the US, Ukraine, and Paraguay, FAS said.

FAS trade data showed that the EU imported at least 2.4 million mt from Brazil and Argentina in January and February, signaling a strong pace of imports through the first five months of the MY 2024-25.

Global soybean meal export prices are currently near five-year lows, driven by abundant global soybean supplies and increased soybean crushing activity in key producing countries, including Brazil, Argentina and the US.

Higher soybean meal consumption in the EU is expected to offset reduced consumption of rapeseed meal and sunflower meal, both of which are facing supply constraints due to lower global production in the MY 2024-25 season, FAS said.

Meanwhile, FAS also expects the EU's imports of soybeans and domestic soybean crush to increase despite the surge in soybean meal imports.

Also, global soybean crush has risen 2.9 million mt to 352.8 million mt, mainly on higher crush for China, Argentina, Thailand, Ukraine and Pakistan in the current MY 2024-25.

This was primarily led by a surge in soybean crushing in China.

FAS has raised its forecast for China's soybean crush in MY 2024-25 to 105 million mt, up 2 million mt from its February forecast.

High prices, biodiesel cut palm oil trade

FAS trimmed its expectations for palm oil imports from the largest buyers, India and China, as high prices weighed on the pace of trade in the current year, the agency said.

India's palm oil imports were pegged at 8 million mt for MY 2024-25 -- its lowest level since MY 2020-21 -- and down 10% from the earlier FAS forecast of 8.9 million mt in February.

China's palm oil imports were revised down to 4.9 million mt for 2024-25, a 5% decrease from February's forecast of 5.15 million mt.

Palm oil, once the cheapest vegetable oil, has traded at a premium to soybean and sunflower oils in global markets since the start of the year, prompting buyers to cut purchases.

The supply tightness has been attributed to increased biodiesel blending in Indonesia, stagnating yields, and floods in Malaysia in the last few months.

Indonesia and Malaysia account for about 85% of the world's palm oil supply.

Biodiesel blending in Indonesia and Colombia, which use palm oil as a feedstock, is also expected to reduce exports in MY 2024-25, FAS said.

FAS's latest report shows Indonesia's palm oil exports falling to 23 million mt in MY 2024-25, cutting 1 million mt from its February forecast of 24 million mt.

Indonesian President Prabowo Subianto has been a vocal proponent of the country's palm oil-based biodiesel policy, raising the blend mandate from 35% to 40% of the country's total diesel supply in 2025.

Similarly, in Colombia, the world's fourth largest palm oil producer, biodiesel production is expected to trim exports to 420,000 mt in MY 2024-25 from around 440,000 mt in MY 2023-24, FAS said.

Platts, part of S&P Global Commodity Insights, assessed China soybean gross crush margin at $38.35/mt on March 11, down $5.69 on day.