Brazil could approve the marketing of genetically modified soyabeans this week, potentially putting supplies of non-GM soya in the balance.
Although official approval was given to Monsantos Roundup Ready soyabeans in 1998, environmental groups blocked sales of the product with an ensuing two-year legal battle which remains unresolved.
With the three biggest producers (USA, Brazil and Argentina) all growing GM crops, it will be difficult to source non-GM soyabeans, says Home Grown Cereals Authority oilseeds economist Josh Dadd.
China and Canada are possibilities, but it is more likely that the shortfall will be met from non-GM producers in north Brazil and the USA.
Traceability will be time-consuming and expensive, and I would expect non-GM soya to trade at a considerable premium to GM beans.
Protein markets have remained quiet this week, as traders remain sceptical about the length of time Brazil will take to make its decision.
The EU-wide fishmeal ban in animal feeds, which was implemented on Aug 1, has also failed to have much impact on prices.
The ban has been in the pipeline for some time, so the effects had already been factored into the market, says Tony Longdon, straights trader for BOCM Pauls.
Reports that the ban could be extended into pig and poultry feed next year were dismissed by Gavin Millar of fishmeal importers David T. Boyde.
I wouldnt take David Byrnes (EU commissioner for health and consumer protection) off-the-cuff comment too seriously we have been meat-and-bonemeal free for six years, and use accurate tests to certify the fishmeal is not cross-contaminated with MBM.
If anything, I would expect a relaxing of the rules, not further bans.
Brazilian soya is trading at about 175/t delivered for October, while fishmeal is worth 440/t delivered in September, and BOCM Pauls superstraight fishmeal replacement, Aminotec, is selling for 343/t.