47 Follow us on Twitter: @PrairieFarming Better Farming | January 2024 U.S. tax credit that is currently set to start in 2025. As part of the Inflation Reduction Act of 2022, the Clean Fuel Production Credit will incentivise clean transportation fuel production in the U.S. This will not only make the Canadian renewable diesel industry less competitive when trying to tap into the U.S. market, but also opens the door for likely cheaper renewable diesel coming into Canada. For Canadian renewable fuel producers, the Canadian government will need to mirror the U.S. tax credit to make the industry competitive. The flip side to the North American oilseed crush capacity expansion is that higher oilseed crush will lead to higher oilseed meal production. And that will then have to garner demand so as to not turn out to be burdensome for the industry. But it may become a “concern” only when most of the expected North American crush capacity expansion becomes fully operational likely by 2026. High oilseed meal production will be good news for the livestock sector as meal protein should be available at cheaper values. In the near-term, the fact that the biggest global soy meal exporter – Argentina – is facing shortages of meal due to the recurring La Niña drought over the last three years will continue to support demand for U.S. soy meal and any excess supplies should find global demand. The higher demand from the renewable diesel sector could be bullish for other crop commodities as the acreage pie is fixed in North America and we may not be able to increase supplies with higher yields. The renewable diesel capacity expansion will attract a lot more soybean in the U.S. and Eastern Canada and canola acres in Western Canada in the next four years, but what complicates the situation is the 89-year drought cycle, which is expected to peak over the next two years. Thus the required higher production of soybeans and canola – to cater to the increased crush demand – is unlikely to come from higher yields, at least not until 2026 or 2027. Crop economics are driving this increase in crush demand, but the big question is whether it will keep up if all the plants and expansion become a reality. Higher crush demand should add strength to the local soybean and canola basis near the locations where the plants are being built. BF Developed for the producer who wants the Bale King Durability, but prefers the chain style feeding system. NEW 7400 Bale King Processor 5300 Bale Processor “Total Rotation” is an upgrade with a 40 bushel bolt on tank and a side mounted 6”: auger. Bridgeview Manufacturing Inc. Box 4, Hwy 22 Gerald, SK S0A 1B0 306-745-2711 · bmi@sasktel.net · www.bridgeviewmanufacturing.com Ad-On features compatible to all Bale King Processors BACK-UP CAMERA KIT Take the guess out of loading. FINE CHOP KIT with adjustable Knives THREE BALE KIT carry 50% more product ·Effortless feeding with Triple chain conveyor with deep, full width slats · Patented X-Rotor with easy access door for simple twine removal · Robust gearbox drive MOE AGOSTINO & ABHINESH GOPAL Maurizio (“Moe”) is chief commodity strategist with Farms.com Risk Management and Abhinesh is head of commodity research. Moe’s Market Minute Government regulations on blended fuels drives the demand for renewable fuels. imageegami - stock.adobe.com
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