* South American nation is distant No. 4 soy exporter
* Industry hopes crushing will take off as plants open
* Crushing vol could rise to 4 mln T from about 1.2 mln
* Exports could rise to 760,000 T from about 250,000 T
By Didier Cristaldo
BUENOS AIRES, Feb 22 Paraguay, the world's
fourth-biggest soybean supplier, could triple its production and
exports of soyoil next year when two large processing plants
come on line, industry analysts said on Wednesday.
The South American country, which currently exports most of
its soy as raw beans, could crush up to 4 million tonnes in 2013
when Archer Daniels Midland, Bunge and Louis
Dreyfus are set to start operating their factories.
Drought has battered Paraguay's 2011/12 soy harvest and
crushers are expected to process 1.2 million tonnes of beans
this year, down slightly from 1.4 million tonnes in the previous
"With the new plants in place, we're going to exceed 4
million tonnes, which means the soyoil exports should reach
760,000 tonnes," said Jose Vargas Pena, president of the
Paraguayan Chamber of Oilseed Processors, or CAPPRO.
That would be a three-fold increase on current soyoil
exports of about 250,000 tonnes, although the figure
only represents about 10 percent of the soyoil produced last
year by Argentina - the world's top supplier of soy products.
Paraguayan growers expect to gather 4.6 million
tonnes of soy this year, a decline of 45 percent on the 2010/11
crop year due to the impact of the La Nina weather phenomenon.
Despite this season's poor harvest, soy production has
surged in recent years in Paraguay. It still trails far behind
neighboring agricultural giants Brazil and Argentina, however.
Both of the new crushing plants, one of which is a joint
venture between Bunge and Dreyfus, are being built in the
Paraguay river port of Villeta, which lies some 50 km (30 miles)
south of the capital Asuncion.
The Bunge-Louis Dreyfus plant will have a processing
capacity of 3,000 tonnes per day, which could later be extended
to 4,000 tonnes per day. ADM's plant will have a processing
capacity of 3,300 tonnes per day.
Vargas Pena said both factories, which required a $300
million investment, will start operating in 2013.
Persistent strong demand for soyoil and high prices
could spur large international grains exporters to make further
investment in Paraguay's crushing industry, said Fernando Masi,
an advisor to the industry minister.
India is the currently the biggest buyer of Paraguayan
soyoil, followed by countries including Iran, Egypt and Morocco.
"If all these companies are investing it's because they
think the international price is going to stay high," Masi said,
estimating that half of the country's soy production would be
crushed within four or five years.
Farmer Tranquilo Favero, the country's biggest single
producer, said that portion could climb to more than two-thirds
of total output.
"The level of investment that's forecast and being
implemented by the multinational soy companies shows that in the
near future Paraguay could be processing about 70 percent of its
soy production," he said. "The outlook is very positive."