Nothing surprising about the WASDE report today except the confirmation of large crops everywhere and ample inventories. Gasoil in Northwest Europe bounced back one standard deviation on renewed fears of escalation in Ukraine war. Heat cracks still just slightly below $20/brl on screen insuring continued supplies. Winter Biodiesel (RME) in Northwest Europe showing narrower gross margin at $155/mt Vs replacement - still quite ok while UCOME is showign a gross margin of $263/mt but few transactions occuring ahead of winter. RSO like Soy oil is now building a contango on ample supplies. Only exception to this are futures in Chicago (CME) as US inventories are narrower before harvest. Crusher association of India released their August data showing increased Soyoil imports +16% (455kt) while palm oil dropped 26% to 797kt and surprisingly Sunflower oil down 22.5% to 284kt. If this is the case, there is either a lot of data missing or a lot of Russian SFO afloat to China instead of India. We do note that China Soyoil stocks were 1 mil mt which in Soybean term is 5 Mil MT which is 50% of their monthly Soy imports that have also been declining slightly but certainly more markedly from US. In a surprising speech/interview the US Secretary of Agriculture was questioned about UCO from China competing with Soybean oil and hurting US farmers and his anwer was that US businesses should be able to handle the competition without further retaliation. The Secretaty stressed Climate Smart Agriculture to reduce carbon intensity of all feedstocks. I attach a chart that reflects some of the ways US can lower US Corn Ethanol Carbon Intensity. It can be accomplished according to study by ANL and shown to a wide audience a the North American SAF meeting by Ecoengineers.
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