Global Market Outlook on Lecithin
The global lecithin market in 2018 is expected to grow at approx. 7 percent CAGR. However, the source of usage is shifting from animal source to vegetarian source. The reason for this change is the demand from consumers and cost reduction. This year, the value of lecithin market is expected to surpass USD 1 billion mark.
- Soybean oil is the major feedstock used in the production of lecithin, due to its large availability and cheaper cost. In 2018, the production of soybean oil is expected to stay moderate– strong and hence, the average price of soybean oil in 2018 is forecasted to fall by 3.5 percent compared to 2017 price
- Rapeseed oil is the second widely used oil for production of lecithin, due to its high content of lecithin. In 2018, the EU is expected to have good production of rapeseed oil, due to favorable climatic conditions. However, Canada might slightly see drop in production, due to dry conditions. The overall rapeseed oil availability is expected to be good
- Sunflower oil is comparatively lower in production volume to the other oils, also most of this oil is consumed for edible purpose. For production of sunflower oil, 2018 is expected to stay the same as 2017
Soybean and rapeseed are the two oilseeds that are forecasted to have high production in 2018. Also, most of the lecithin coming from oilseed are produced from rapeseed and soybean oil. Commercial viability for lecithin production from soybean and rapeseed are cheaper and efficient. Cotton seed oil can be used to produce lecithin, however, with low volume it is not suitable commercially.
- Soybean oil: Improved crush margins, owing to tight soy meal supply and increasing use of soy oil-based biodiesel have been witnessed in the US and Brazil, which are likely to curb the stock levels and induce demand, keeping the price points in an upward trend
- North America: Stocks in the US are ample and crushing in the US has increased with whooping import demand for soybean meal in April/June 2018
- LATAM: Significant soybean crop losses in Argentina and Uruguay have been offset with better than estimated production volume in Brazil
- Sunflower oil: Global production of sunflower seed is seen declining by 1.35 MMT, which is projected to curtail the sun oil and meal supplies
- Crushing of sunflower seed is witnessed to increase with surplus sunseed stocks in the market. In addition, declined crushing of rapeseed, owing to less rapeseed oil demand, has influenced the market of sunseed and soybean
- Rapeseed oil: The EU is expected to witness higher production of rapeseed oil this year, at least 8–10 percent higher than last year. Meanwhile, Canola oil in Canada is anticipated to expect low production, due to unfavorable weather conditions. Lowered consumption of rapeseed in the EU and China, increase in imports of biodiesel from Argentina, are likely to witness the price to remain stable in the long term, where total EU rapeseed consumption is expected to be at 10 MMT in 2017–2018