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Brazil Soy Crushers Halt Production as Margins Go Negative
USAgNet - 09/30/2022

A number of Brazilian soybean processors have temporarily halted units as crushing margins turned negative, reflecting weak domestic demand for biodiesel and high vegetable oil inventories at production sites, according to two analysts on Wednesday.

Abiove, a trade group representing global oilseed crushers in Brazil, confirmed the move, telling Reuters that some of its members advanced scheduled maintenance stoppages as soy oil prices dropped even as soybean prices remained high, hurting margins, reports Reuters.

Victor Mendes, an analyst at HedgePoint Global, said Brazil has over 99 soybean crushing plants, adding over 10 units had already been halted as global soy oil prices fell reflecting a spike in Indonesian palm oil stocks.

Abiove could not comment on how much capacity has been shut, but said it may revise 2022's soy processing forecasts as fresh crushing data come in reflecting changes in the market.

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