Brazil's 2023 soybean crushing set for record highs driven by oil, meal demand

Brazil's soybean crushing is estimated to reach a record high 53.5 million mt in 2023 from the previous month's estimate of 53.2 million mt, driven by a greater demand for soybean oil and meal, according to the latest release from the Brazilian Association of Vegetable Oil Industries, or Abiove, on July 20.

In the 2022 campaign, raw bean crushing stood at 50.932 million mt.

Projections for exports of soybean oil and meal derivative in 2023 were also increased from June's estimates. Sales of Brazil's soybean meal were pegged at 22 million mt, up from 21.9 million mt in June estimates. This was up 8.05% year on year from 20.36 million mt in 2022.

Latest estimates for Brazil's soybean oil sales stood at 2.4 million mt, up from 0.1 million mt in the June forecast.

The country's soybean production and exports were also projected to hit a new record high in the 2023 campaign. Soybean production in the current harvest was estimated to reach 156.5 million mt, an increase of 500,000 mt compared with last month's projections.

"The international market will continue to increase the demand for products from the Brazilian soy complex this year," Abiove said in its statement. "The export of soybeans in grain grows from 97 million mt measured in the previous projection to 97.5 million mt in the current balance sheet."

The supply projections for Brazil's soybean derivatives also showed a slight increase. Meal production was estimated at 41 million mt, up 300,000 mt from the previous evaluation. Soybean oil production was estimated at 10.8 million mt, a 100,000 mt increase from June's projections.

Brazil is traditionally the world's largest producer and exporter of soybean. With surging demand from China and supply constraints from drought-hit Argentina, Brazil is expected to be the leading supplier and exporter of raw beans and meal derivatives in marketing year 2023.

Platts assessed Brazilian soybean oil FOB Paranagua for August loading at $1,006.19/mt July 20, $24.03/mt higher on the day, S&P Global Commodity Insights data showed, while Brazilian soybean meal FOB Paranagua for September loading was assessed at $485.67/mt July 20, $4.08/mt lower on the day.