In its latest Oil Crops Outlook, the USDA raised the canola crush forecast for the 2022-23 October to September time period to a record high, pushing production of oil and meal higher in 2022-23.
Along with higher crush, the 2022-23 canola oil imports were revised up and finalized at a record 6.3 billion pounds.
The USDA said the trend in canola oil imports is largely driven by a strong demand for canola oil after the Environmental Protection Agency (EPA) approved the canola oil pathway for renewable diesel in December 2022.
For 2022/23, canola oil used for biofuel is estimated at 3 billion pounds. The 2022/23 canola oil for food use is estimated to reach a record high in 2022/23 at 5 billion pounds, up 0.2 billion pounds from last month.
Ending stocks in 2022/23 are finalized at 0.2 billion pounds. The 2023/24 canola oil balance sheet is left unchanged with canola oil used for biofuel growing to 3.4 billion pounds and imports rising to 6.6 billion pounds.
The USDA also reported that from October 2022 to August 2023, soybean oil use in biofuels totaled 11.3 billion pounds, 19% higher than same period the prior year. This caused the agency to increase its estimate for soybean oil use in biofuels production by 300 million pounds to 12.4 billion pounds in the coming marketing year.
According to reports, oilseed markets have recovered quite a bit of ground recently as Brazil planting weather has caused problems for the upcoming soybean crop. Canola reached a one-month high until November 22 when it closed lower, reportedly failing to close above key technical levels. Canola prices have lagged soybean oil prices, which rose 5.6% since the beginning of the month.
