But to those watching closely, like a coach seeing their NBA team scrape by a college squad, this "record" was anything but triumphant, says US soy industry consultant, Gordon Denny.
The missed opportunity
The math told a different story. The US soybean crushing industry, armed with great margins, robust demand for meal and oil, and solid transportation logistics, had all the ingredients for a much stronger showing, argues Denny.
According to updated calculations, even at an 88% utilization of the industry’s maximum capacity, the NOPA crush should have hit 208 million bushels for October, he reports.
The figures
As per Gordon Denny’s data
- Maximum daily crush at 100% capacity: 8.121 million bushels for 68 plants.
- Adjusted for 88% utilization and exclusions: 6.711 million bushels per day for 64 realistic NOPA-reporting plants.
- Expected October crush: 6.711 million bushels x 31 days = 208 million bushels.
But the reality fell nearly 8 million bushels short, says the consultant.
A challenging outcome despite favorable conditions
On paper, everything seemed to align for a robust performance in the soybean crush industry, notes the consultant. The harvest was in full swing, with plenty of beans available to meet demand. The meal and oil markets were thriving, reflecting strong consumer interest. Margins were as favorable as they had been in a long time, offering an excellent opportunity for profitability. Even logistics, often a bottleneck, ran smoothly with transportation systems performing efficiently. Yet, despite these ideal conditions, the crush numbers fell short of expectations, reiterated Denny.
The reasons behind this underperformance were complex and varied. Possible culprits included processing challenges with overly dry beans and potential underreporting by one or more plants, he claims.
The dry bean problem
Very dry beans can add an extra layer of complexity to processing, creating dehulling problems, slowing down crush rates and forcing compromises in efficiency, meal quality, and compliance. Processing dry beans is a delicate operation prone to multiple points of failure, with limited solutions available when things go wrong, reports the consultant.
These issues cast a shadow over what should have been a stellar season for the industry, remarks Denny. Even with these plausible explanations, the results remained disappointing, especially considering recent capacity expansions across the industry, with five new crushing plants coming online in 2024, collectively adding 505,000 bushels of daily capacity, he adds.
