Grains –
The EIA updated with biodiesel production figures on Friday, but unfortunately the data is only current through the end of Oct. The EIA reported biodiesel production of 142 mil gal which is the highest I have on record going back to 2011. Soyoil use in biodiesel production totaled 526 mil lbs, which is down from the average of the past several months and the lowest since June. Soyoil’s share of biodiesel inputs fell to roughly 46% which is the lowest in at least a year.
The attached chart shows soyoil monthly inputs by marketing year. We’re off to a decent start in 16/17, as expected, and the red dashed line indicates the average monthly pace needed to match the WASDE projection. Keep in mind, however, inputs are likely to drop sharply at the start of the calendar year as the blending tax credit is no longer in force. Bottom line there appears to be nothing here to argue for a change in the WASDE projection for now.
Biodiesel imports continue at a strong pace. Some have argued that the end of the blending tax credit will change that but I still fail to understand that logic.
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