Spotlight on soybean meal

• One of the key drivers of global soybean production is the growing demand for soybean meal from the animal feed industry. The USDA estimates that 2018/19 global soybean meal production could reach 247 million tonnes, up by 36 percent from the previous season. China, the US, Argentina, Brazil, EU, India and Russia are the key drivers of this uptick in meal production.
• There are a couple of interesting things about China’s lead in soybean meal production. Firstly, China produces roughly a third of global soybean meal and almost all of it is utilised within the domestic animal feed industry. Secondly, China is a small producer of soybean, with 2018/19 production estimated at 15 million tonnes, therefore, meal production is largely boosted by imports. Lastly, China is likely to remain a key producer of the meal, hence soybean imports are set to increase in the near future. The USDA forecasts the country’s 2018/19 soybean imports at 103 million tonnes, up by 6 percent from the previous season.
• Argentina, which is the third leading producer of soybean meal, is an important player in the South African animal feed industry. While South Africa’s soybean meal imports have been on a declining trend since 2010, Argentina remains the key supplier accounting for 99 percent of the imports into South Africa.
• Last year, South Africa imported 553 003 tonnes of soybean meal. We estimate that this year imports could decline by 17 percent to 458 992 tonnes. This is largely on the back of expected large domestic soybean supplies. As set out in yesterday’s note, South Africa’s soybean supplies are in better shape in the 2018/19 marketing year, estimated at 1.75 million tonnes, up by 24 percent from the previous year. The supply figure includes production, opening stock and a small volume of imports.

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