Soybean crushing capacity to increase by 2027

Itaú BBA has mapped 13 new projects that will add 37 tons/day to Brazil’s soybean crushing capacity between 2025 and 2027, through new plants and expansions. The nominal value of the investments reaches approximately R$11,3 billion in this period, resulting in an additional capacity of 11,1 million tons per year.

The projection is that the new investments will increase the installed soybean crushing capacity in Brazil from 59,8 million tons in 2024 to 72,1 million tons in 2027.

If the industry's utilization rate remains at 92% – the historical average –, estimated milling will increase from 54,5 million tons in 2024 to 66,3 million tons in 2027, which represents an annual growth of 6,8%.

“In recent years, the vegetable oil industry has seen a significant increase in the volume of crushed soybeans. Part of this expansion is due to the increased use of biodiesel in Brazil, a trend that is expected to continue in the coming years, driven by the new Fuel of the Future law,” says Lucas Brunetti, an analyst at Itaú BBA’s Agro Consulting.

Despite the increase in crushing capacity, the exportable surplus of soybeans in Brazil is expected to grow, but with declines in some states such as Pará, Rio Grande do Sul, Paraná and Goiás until 2027.

Mato Grosso, in turn, is expected to record the largest increase in exportable surplus, around 9,9 million tons by 2027. This is due to the expectation of greater production and the absence of new crushing plant projects in the state, which has a strong supply of oilseeds.

Biodiesel and by-products

According to Itaú BBA, demand for biodiesel, due to the "Fuel of the Future" law, should increase the biodiesel blend content (BX) from the current 14% to up to 25% in the long term. Although the increase in the blend is uncertain, it is expected to occur gradually, with annual increases of 1%.

The expectation is that the mix will reach 15% in March 2025, 16% in March 2026 and 17% in March 2027, although these increases will need to be ratified annually by the National Energy Policy Council (CNPE).

Diesel consumption in Brazil is expected to reach 72,9 billion liters in 2027, up from 67,8 billion liters forecast for 2024. Biodiesel consumption is also expected to grow, rising from 9,3 billion liters in 2024 to 12,3 billion liters in 2027, an annual increase of 9,7%.

Thus, the study indicates that the demand for soybean oil for biodiesel production is expected to jump from 5,9 million tons in 2024 to 7,9 million tons in 2027, an increase of 34%.

With this growth in biodiesel consumption, soybean oil exports are expected to remain at lower levels, around 1 million tons, below the average of 1,8 million tons over the last five harvests.

This scenario tends to generate an excess of bran in the domestic market. Even with accelerated growth in exports and domestic consumption, a significant increase in product stocks is expected.

According to projections, Brazilian soybean meal production is expected to grow from 42,5 million tons in 2024 to 49,2 million tons in 2027, an increase of around 7 million tons.