AdM launches “freenzy” in the soybean market in the United States before the base of the new biofuel mix

Written by Tom Polansic and Carl Bloom

Chicago (Reuters)-Archire-Daniels-Midland, the main American soy and biofuel producer, cut off its offers to buy oil seeds this week before the expected Trump administration about the requirements of mixing biofuels, a basic engine to demand soy oil.

Chekago -based processors are awaiting the decision of the US Environmental Protection Agency to mix the requirements for several months while struggling with overwhelming margins in soybeans.

Reuters said on Thursday that the Environmental Protection Agency is expected to suggest the mixing requirements of the industry on Friday, which leads to the low demand for soybeans expected to be used in biofuels.

ADM said in a statement sent via e -mail to Reuters on Thursday that he had no insight into the announcing of the pending mixing beyond the information available to the public and that it is independently determined by the basic offers, which is the difference between future contracts and a local cash price to take over the pills immediately.

On Wednesday, the company presented its cash offer at the pioneering Decatur, Illinois to 20 cents under the price of the Chicago Trading Board in November, soybeans from 22 cents over the future of July.

Roll to November Futures, which closed 15 percent to July on Thursday, reduced the local cash price by about 60 cents for Bushl, which represents a 6.5 % decrease in the price offered to farmers.

AdM also rolled the foundation shows in its other overwhelming facilities, and followed some competing treatments, including Cargill, ADM on Thursday. Other processors kept their basic offers against futures contracts in July, but the foundation values ​​decreased by up to 15 cents.

“Adhamir Decaator put the bean market in madness,” said John Stewart and Associas.

Falling values ​​reflect the expectations for the great autumn harvesting and weak demand that erodes the processing margins of companies that crush beans to feed livestock and soybeans used in cooking and biofuel production.

The crushing margin has struggled because the recent treatment jump in the United States has swallowed the supply of meals, oil and pressure on soy products.

Fears of customs tariffs and unclear policies of biofuels have sparked more uncomfortable between crushers and biofuels, and some biotechnals producers have expanded plants or kidnappers.

ADM said in April that it will always close the soybean processing station in South Carolina to reduce costs.

“The cash crushing margins are stinking, and there is a set of stopping to be held in July,” said Charlie Creniner, CEO of Marex Capital Markets.