A detailed analysis of the effect of banning meat and bone meal in Europe on the export market of soybean and corn in the United States

OA show ('918 '); main point: if the demand for soybeans or soybean meal in Europe can stimulate the demand for soybeans in the United States by 150 million bushels as some people in the commodity trade industry expect, then this means that the price of soybeans will rise by 55 cents per bushel U.S soybean and corn exports are very different, according to the U.S Department of agriculture U.S soybean exports will increase while corn exports will shrink, the U.S Department of Agriculture said in its December world supply and demand report The increase in soybean exports is due to the increased demand for us soybeans from European livestock farmers due to EU restrictions on feed formulations in the wake of BSE "There is a sense in the market that the wave of mad cow disease will lead to an increase in European demand for soybean meal of 3 million tons per year," said don north of the US Commodity Company in West Des Moines At the same time, the U.S Department of agriculture also lowered the forecast value of American corn export Because the corn exported to Japan by the U.S was found to be contaminated by Starlink genetically modified corn, which caused a storm, the U.S Department of agriculture lowered the corn export by 75 million bushels The U.S government has approved Starlink genetically modified corn for livestock feed, but it cannot be used for human consumption Many countries, including Japan, refuse to import corn containing Starlink gene It is worth mentioning that Japan is also the largest importer of corn in the United States "Starlink is responsible for the decline in U.S corn exports," Mr North said In Europe, the European Union recently decided to ban the use of meat and bone meal (MBM) within the EU starting from January 1 next year due to concerns that feed from animals, such as meat and bone meal, may spread a disease called mad cow disease (cow spongiform encephalopathy) Mad cow disease can spread to other animals as well as to humans who use the meat of infected animals In Europe, ground animal limbs are used as a source of protein for livestock feed EU authorities hope to curb the spread of BSE by banning the use of animal limbs for livestock feed The U.S Department of agriculture predicted in the world supply and demand report that European soybean imports will increase by 900000 tons compared with last month's forecast, and the increase in soybean meal imports may be as high as 600000 tons "The two countries are expected to be more inclined to import soybeans because of the ban on fat for food and feed use in Germany and France," the USDA report said Robert Wiener, visiting economist at Iowa State University, said soybeans imported between January 1 and March next year will come mainly from the United States Almost all the 1999 / 2000 soybeans harvested in South America last spring were exhausted, while the new soybeans in 2000 / 01 had not been planted "It's two and a half months before South America can provide soybeans for export," Wiesner said If Europe's demand for soybeans or meal could spur demand for us soybeans by 150 million bushels, as some in the commodity trade industry had expected, that would mean a 55 cent rise in soybean prices, Wiesner said In the world supply and demand report in December, the U.S Department of agriculture raised the soybean price forecast range of 2000 / 01 by 10 cents per bushel, to between $4.50 and $5.10 per bushel The U.S Department of agriculture is also setting up a testing program to test whether the corn used for export contains Starlink gene, in order to eliminate people's concerns about genetically modified corn "The key to corn export is how fast we can handle the Starlink storm so that our customers can rest assured that Starlink is no longer included in US grains," Wiesner said Once the USDA is able to start running the validation program, Japan will return to the US market " The U.S Department of agriculture cut its annual corn price forecast range by 5 cents to $1.65 to $2.05 a bushel This market year ends on August 31 next year Next month, North said, the U.S Department of agriculture will release a 2000 crop yield report The report will show corn export sales down 90 million bushels to 150 million bushels "Don't forget that our total corn demand this year is still more than 10 billion bushels," North added This is the first time corn demand has reached such a high level "