The soybean processing industry is going through the biggest expansion phase in 20 years. That includes the ADM crush plant in Aberdeen and a facility in Michigan that are expected to come online later this year. The proposed projects at Spiritwood, North Dakota and Crookston, Minnesota are also part of the expansion story. CoBank economist Will Secor says the U.S. market will not be able to absorb all of the new production immediately. “When we look at the first year of these plants coming online for the 2019-2020 marketing year, we see about 40 percent of the meal being absorbed by domestic users when typically about 75 percent of soybean meal production is consumed domestically.” Secor sees the potential for stronger basis levels with the new processing plants coming into the region. “A lot of that meal will be shipped out of the Pacific Northwest, particularly to Southeast Asia, where there is a lot of growth in meal demand.” Secor expects to see some growing pains with the new crush capacity, but it should be short-lived.
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