Global soybean demand in 2019-20 seen up 1% on year: USDA
Global soybean demand in 2019-20 marketing year (October-September) is projected at 148.86 million mt, up 1% year on year, due to increased Chinese purchases, according to the latest report by the US Department of Agriculture.
The world’s top soybean importer, China is expected to buy 85 million mt of soybeans in 2019-20, up 2.4% on year, despite African swine fever, the USDA said.
Although the Chinese pork industry has been hit hard by African swine fever, the demand for alternative meat products, such as poultry, has increased, leading to a rise in soybean imports in 2019-20, sources said.
Accounting for over 60% of global soybean imports, China processes more than 80% of its imported soybean into meal, which is then primarily used as feed for hogs and poultry.
Other major markets with higher soybean demand in 2019-20 were Mexico, Egypt, Japan, Thailand, Indonesia, Taiwan and Turkey, the report said.
Brazil is set to remain the top soybean exporter in 2019-20 marketing year at 76.5 mil mt, up 0.6% on July estimate, the USDA said.
Brazilian soybean production in 2019-20 is seen at 123 million mt, up 5% year on year, while domestic soybean consumption is projected at 46.6 million mt, up 1.5% on the year, the data showed.
Soy meal shipments by Brazil, world’s second-largest exporter, in 2019-20 are projected at 15.2 million mt, down 5.6% on year, the report said.
Brazil’s domestic soy meal demand in 2019-20 is set to increase 4.3% on the year to 18.97 million mt, leading to the cut in exports, sources said.
US soybean production in 2019-20 marketing year (September-August) is expected at 100 million mt, down 19% on year, as the unfavorable spring weather decreased the planted area estimate, the USDA said.
Soybean exports by the US in 2019-20 are seen at 48.3 million mt, up 4.4% year on year, while the ending stocks are at 20.5 million mt, down 30% on the year, the data showed.
Before the trade dispute started last year, China used to be the biggest market for US soybeans, taking over 60% of US soy exports. In July 2018, China imposed an additional 25% import tariff on US-origin soybeans in response to tariffs the US had placed on Chinese goods. As a result, soybean shipments from the US to China fell 81% year on year to 5.4 million mt July 2018-March 2019, according to the US Census Bureau, as Chinese buyers looked to South America for soybeans.
Argentina soybean production in 2019-20 marketing year is forecast at 53 million mt, down 5.3% on year, the USDA said.
Soybean exports by the South American nation in 2019-20 is seen at 8 million mt, up 3.2% year on year, while the ending stocks are at 27.2 million mt, down 10.5% on the year, the data showed.
Soy meal shipments by Argentina, world’s top exporter, in 2019-20 are projected at 30.5 million mt, up 9% on year, the USDA said.