Chinese biodiesel producers are seeking new outlets in Asia for their exports and exploring producing other biofuels as supply to the European Union, their biggest buyer, dries up ahead of anti-dumping tariffs, biofuel executives and analysts said. The EU will impose provisional anti-dumping duties of between 12.8% and 36.4% on Chinese biodiesel from Friday, hitting over 40 companies including leading producers Zhejiang Jiaao, Henan Junheng and Longyan Zhuoyue Group in an export business that was worth $2.3 billion last year.  Some larger producers are eyeing the marine fuel market in China and Singapore, the world's top marine fuel hub, as they seek to offset already falling biodiesel exports to the EU, biofuel executives said. Exports to the bloc have fallen sharply since mid-2023 amid investigations. Volumes in the first six months of this year plunged 51% from a year earlier to 567,440 tons, Chinese customs data showed.

After years of high food prices caused by droughts in major agricultural producing regions like South America, and the Russia-Ukraine war and its medium-term impacts, global agricultural producer prices and consumer food prices have continued to moderate over the recent months. Global food prices have dropped by approximately 25% since their peak in March 2022, when Russia’s invasion of Ukraine sparked widespread disruption and panic in the global agricultural market, driving prices to record highs. According to the Food and Agricultural Organisation of the United Nations (FAO), the FAO Food Price Index decreased slightly to 120.8 points in July 2024 from the revised June 2024 figure of 121 points. This minor drop was primarily driven by a decline in grain prices, although other food commodities saw slight increases. Notably, the index is now 3% lower than its level in July 2023, indicating a moderate decrease in global food prices over the past year. For the second month in a row, global export prices for major grains have fallen, with wheat prices continuing to face downward pressure. The FAO attributes this decline to harvesting pressure from the northern hemisphere wheat producers and optimistic outlooks for spring wheat production in Canada and the US due to favourable weather conditions.  

This week, the rand averaged R18.18/US$, stronger by 1.3% w/w and by 4.9% y/y. The rand firmed on expectations of a Federal Reserve interest rate cut, combined with optimism about South Africa’s economic prospects and easing inflation • This week’s Brent crude oil price averaged US$80.33/barrel, up by 4.1% w/w but down by 5.9% y/y. The increase comes after ceasefire negotiations in Gaza commenced, raising optimism that a peaceful resolution would minimise supply chain disruptions and ease tensions in the region. • This month, Brent crude oil prices have decreased slightly from July 2024, while the rand has been stable. For the remainder of this month, oil prices should remain steady, while the rand could weaken slightly. As a result, local fuel prices could decrease as follows on 04 September 2024: petrol (95 unleaded) by 59c/l; diesel 500ppm and 50 ppm by 41c/l and 68c/l, respectively.  

This week, the yellow maize price averaged R4 118/ton, down marginally by 0.04% w/w but up by 14.1% y/y. The white maize price averaged R5 364/ton, up by 2% w/w and by 49.8% y/y. • The white maize prices were supported by good domestic buying demand which more than offset the effects of a recovering rand. • Chicago maize prices decreased steadily as traders resumed a trend of technical selling • In week-15 of the domestic 2024/25 maize marketing year (MY), 9.4 million tons of white and yellow maize had cumulatively been delivered. In the same week, cumulative exports of white and yellow maize reached a combined 606 455 tons. • The top three export destinations of white maize were Zimbabwe (206 205 tons), Botswana (66 632 tons), and Namibia (57 893 tons). The top three destinations of yellow maize were Zimbabwe (114 734 tons), Botswana (28 968 tons), and Eswatini (24 472 tons).  

This week, the soya bean price averaged R8 416/ton, down by 3.1% w/w and by 9.5% y/y. The sunflower seed price averaged R8 798/ton, down by 1.1% w/w and by 4.5% y/y. • The oilseed prices were largely pressured by the recovering local currency and lower Chicago prices. • Chicago soya bean prices experienced a brief upward movement yesterday, but eventually declined due to technical selling. • Cumulative domestic oilseed deliveries by week-24 of the 2024/25 MY stood at 1.7 million tons of soya bean and 614 446 tons of sunflower seed

The wheat price averaged R6 285/ton, down by 0.2% w/w and by 5.8% y/y. • The wheat prices were pressured by the recovering rand. • In week-45 of the local 2023/24 MY, cumulative deliveries were at 1.989 million tons. • In the same week, cumulative wheat imports stood at 1.656 million tons, with 423 505 tons coming from Russia, 373 979 tons from Poland, and 363 584 tons from Lithuania, amongst others.

World Farming Agriculture and Commodity news - Short update - 5th August 2024

Since the July WASDE report, export bids for all major exporters have increased, according to a recent USDA FAS world grain markets report. US bids experienced the least change, up just $1/ton to $182, and are currently the most price competitive on expectations of plentiful supplies. For the week ending August 4, NASS estimates 67% of the corn crop to be in good-to-excellent condition, compared to 68% a week prior and 57% a year ago. 

Ukrainian bids were up $19/ton to $205. Hot, dry weather in Ukraine may be influencing supply expectations for the upcoming crop. 

Brazilian bids were up $5/ton to $192 and Argentine bids were up $4/ton to $184. Farmer sales and exports have been sluggish in both countries.

A surge in domestic demand for corn in India has sharply curtailed exports and led to record imports for TY 2023/24 (Oct-Sep). Driving factors for this rise in demand include government ethanol policy and a growing poultry market. Historically, India has been a net exporter that supplies significant volumes of corn to South and Southeast Asia. For the first time since 1999/00, India will import as much corn as it exports.

India recently revised its 2018 National Policy on Biofuels to include corn as a feedstock, offering price incentives for corn-based ethanol2. Sugar, India’s primary feedstock for ethanol, has faced government restrictions in usage for ethanol following multiple years of low production, further incentivising corn feedstock. 

Ethanol manufacturers’ shift to corn as an alternative coincides with a 10% increase in feed demand from India’s growing poultry sector. For the first time since 2019/20, India has imported foreign corn from Ukraine and Burma, where non-GE corn cultivation meet India’s GE import restrictions. Additionally, in June, India announced corn imports of 500,000 tons under a Tariff Rate Quota (TRQ) at a 15 percent duty to satisfy this sharp rise in demand3.

High global supplies have facilitated a drop in international corn prices in 2023/24. This has dampened India corn exports as strong domestic prices have incentivised traders to keep supplies in-country. 

India has been a key exporter to Vietnam, Nepal, and Bangladesh, exporting 2.8 million tons of corn in 2022/23, nearly a quarter of the countries’ combined total corn imports. However, exports from India to these countries declined 86 percent in the first 8 months of 2023/24 year over year. In response to this drop- off, countries shifted to other exporters or relied further on domestic supplies.