Market Trends of Soybean Industry
Increased Demand for the Byproducts of Soybean
In recent years, the demand for soybean by-products, such as soybean meal and oil cakes, has surged. Their high nutritional value has boosted their popularity among consumers, driving the market's growth. Factors like rising disposable incomes in developed nations and enhanced soybean productivity have further fueled this demand. According to the USDA, U.S. soybean oil production reached 12.28 million metric tons in 2023, up from 11.3 million metric tons in 2019. This growing demand for soybean oil is set to bolster the market during the forecast period.
Moreover, soy lecithin, a soybean by-product, is gaining traction as a versatile food ingredient. Its applications range from acting as a wetting agent and managing cholesterol to enhancing flavor in dietary supplements, ice creams, dairy products, newborn formulas, bread, margarine, and other convenience foods. Soybean meal, with its unique amino acid profile, serves as a viable alternative to cereal proteins. The demand for soybean meal, especially as high-protein animal feed, has surged in rapidly developing nations like China, driven by a rising appetite for animal protein. While long-term growth rates in soybean production are outpacing yield increases per land unit, the demand remains robust. This is largely due to the health benefits of protein-enriched foods and a burgeoning global livestock population, including cattle and ruminants.
South America Dominates the Market
South America dominates the global soybean export market, with Brazil, Argentina, and Paraguay collectively supplying over 50% of the world's soybeans. In 2022, Brazil led South American soybean exports, contributing 49.7% to global totals. The United States followed with 36.8%, and Argentina trailed at 3.3%.
Brazil's soybean production rose from 121.8 million metric tons in 2020 to 134.7 million metric tons in 2021, setting the stage for boosted exports in subsequent years. Enhanced awareness and expertise among local farmers, coupled with rising domestic and global demand for oilseeds, have positively influenced soybean prices and farmer revenues. Furthermore, the US-China trade tensions have notably spurred Brazilian exports to China.
Argentina stands as the leading global exporter of soybean oil and meal. For instance, data from the ITC trade map highlights Argentina's export of 6,010,691 metric tons of soybean oil in 2021. Meanwhile, Paraguay ranks as the world's fourth-largest soybean exporter. Data from the Paraguayan Chamber of Soybean Exporters reveals that Paraguay exports over half of its soybean production, underscoring its economy's heavy reliance on these shipments. Additionally, a bolstered livestock population and rising demand for soybean meals have further fueled exports from South American nations to the Asia-Pacific and European markets.
