May 1, 2006
Bush’s Support Of Biodiesel Draws Praise From Industry Representatives
President George W. Bush last week touted biodiesel as a key component of his plan to confront high fuel prices. “It’s truly rewarding to hear the President of the United States include biodiesel in his plan to address skyrocketing fuel prices,” said American Soybean Association past-President Bart Ruth, who represented ASA at the Renewable Fuels Association summit in Washington. “ASA has long advocated that farmers stand ready to help address our nation’s energy needs, and the President validated that point again today,” he added.
During his remarks, the President impressed upon listeners the need to continue investing in alternative fuels. He said: “Research and development has led to new alternative sources of energy like biodiesel. So that’s one of the reasons why I signed into law the first ever federal tax credit for biodiesel producers. In other words, we’re interested in addressing our energy security on a variety of fronts. It makes sense for the United States to have a comprehensive strategy to help us diversity away from oil.”
In related news, multiple pipeline companies last week conducted test shipments of distillate with a 5 percent blend of biodiesel via East Coast pipelines. If the tests are successful, the potential of moving biodiesel blends through major petroleum pipelines would give the product a shipping cost advantage over ethanol. Meanwhile, some sources say the Environmental Protection Agency (EPA) is mulling giving biodiesel up to 50% more credit than ethanol in renewable fuel credit trading.
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Limited Impact Of Rust So Far In 2006
Asian soybean rust has had limited impact on crops so far in 2006, as no new discoveries of the airborne fungus have been reported in the U.S. since the first week of March, according to USDA. “Scouting for soybean rust continues on kudzu patches from Florida northward to southern Illinois, and westward to Texas,” the USDA said.
The latest soybean rust infection outlook provided by the North American Plant Disease Forecast Center at North CarolinaStateUniversity suggests that high pressure, sunny skies and a general lack of rain will continue to hamper movement of the disease. “Transport conditions will be unfavorable for airborne spore survival,” the center said Monday. “With the very low levels of disease activity at present, long-range transport is highly unlikely.”
In related news, The American Phytopathological Society has scheduled its 2006 National Soybean Rust Symposium for November 29 to December 1, in St. Louis. The symposium will attract leading experts on the disease, including academic researchers, media, state and federal government officials, crop chemical manufacturers, educators and crop consultants; plus representatives of various soybean grower organizations and the food industry.
Congress Urged To Make Agriculture Transportation A National Priority
The National Grain and Feed Association (NGFA) told Congress last week that U.S. agriculture is engaged in a “chronic struggle” to obtain predictable rail service, given severe transportation capacity constraints that may take many years to improve. The NGFA testified that improving transportation capacity for all modes – rail, waterway and truck – should be an “urgent” national priority.”
Keith said that transportation capacity constraints have affected every transportation mode within the last few years, but rail capacity challenges facing U.S. agriculture have become critical within the last three years. For grain and grain product shippers, the NGFA said, it has become increasingly uncertain to know when rail equipment will arrive for loading, when it will be furnished with locomotive power and when the shipment will reach destination. “
The NGFA offered several recommendations during the hearing on steps that would contribute incrementally to improving rail capacity:
- Rail carriers should adopt more equitable and balanced policies for using privately owned or leased rail cars. Private shipper-owned or leased cars comprise 54 percent of railcar fleet, and 100 percent of tank cars used to haul vegetable oil, corn syrup, ethanol and other liquid agricultural products.
- A “wider” adoption of balanced incentive and penalty programs to reward prompt delivery and movement of cars by railroads and prompt loading and unloading by shippers and receivers.
- Several rail carriers should reform their policies for imposing fuel surcharges that far exceed the actual increased cost of fuel being incurred by the carrier
India Details Import Regulations For GM Soyoil
Last week, India detailed the procedures it will now require for the regulation of imports of soyoil derived from genetically modified (GM) soybeans. The new regulations sate that GM derived soyoil cannot be imported or processed or consumed without the approval of the government’s Genetic Engineering Approval Committee (GEAC) the Ministry of Environment and Forests said.
India’s government also said importers will have to submit a study to the GEAC on food safety conducted in the country of origin of the soyoil. Importers will also need to submit a report on soyoil from the place where it is imported and another report on the byproducts obtained while processing GM soyoil. A declaration on the method of disposal of the byproducts will also have to be submitted, as they may contain genetically modified material.
Importers will then have to state whether the imported soyoil has been approved and is in commercial production in the country of origin. Finally, importers will now be required to submit details on whether the imported GM soyoil will be subsequently sold to refineries with state-of-the-art facilities or to local refineries.
Soy Complex Mixed On Weak Demand And Slow Export Sales
The soy complex closed mixed on April 27 reflecting weak export sales of soybeans and meal, a curtailment of Russian chicken imports and concerns that a hike in China’s interest rate would cool off the demand for commodities.May bean futures closed down $0.18 finishing at $211.37; July was $0.18 higher, closing at $216.97; and August was unchanged ending at $218.81. May meal was down $1.87, closing at $188.71; July was $1.87 lower, finishing at $189.49; and August decreased $1.54 to finish at $191.14. May oil closed $8.82 higher to finish at $554.90; July was up $9.92, closing at $565.48; and August gained $10.36, ending at $569.67.
