Soybean Market Intelligence

Soybean Market Description

The U.S., Argentina, and Brazil are the largest producers of soybean and account for 82 of the global soybean production. China is the major soybean producing country and accounts for 33 percent of the global production. The majority of its soybeans are used for crushing purposes, which produce soy meal and soy oil. Soy meal is widely used in the animal feed industry, whereas soy oil is used in food, biodiesel, and oleochemical industry. However, an increase in the domestic soybean production is expected to reduce China’s import demand in the international markets over the coming years. As a result, this could drive the world-stock to use ratio above 25 percent.

An increase in income levels and consolidated supply are expected to support 20 to 30 percent growth in soybean production and trade until the next ten years. This trade growth is expected to be led by LATAM in the upcoming years. The report also provides the soybean market outlook of its products in the U.S., Brazil, China, and Argentina, along with trade dynamics, and an overview of supply-demand. It also provides a comprehensive analysis of the soybean industry market, which includes Porter’s five forces analysis, along with the latest industry innovation and trends.

Beroe gathers intelligence through primary sources that include industry experts, researchers, and consultants, as well as current suppliers, producers and distributors. Secondary sources can include business journals, newsletters, magazines, market research data, company sources, and industry associations. Following data collation, analysis, and strategic review, the Final Research Report is published on Beroe LiVE.

Report Coverage

Global Soybean Supply–Demand Analysis
Global Soybean Trade Dynamics
Regional Market Outlook – US, Europe and Asia
Innovations

Soybean Market Trend, Analysis & Forecast

Category Intelligence on Soybean covers the following

Information relating to market, supply, cost, and pricing analysis
Hard to find data on cost and TCO models, supplier details, and performance benchmarks
Macroeconomic and regional trends impacting cost, supply, and other market dynamics
Category-specific negotiation and sourcing advice

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Executive Summary

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Market Analysis

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Supply Analysis

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Cost & Pricing Analysis

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Best Practices

1. Soybean Market Executive Summary

1.1 Global Soybean Market Overview
1.2 Contract Structures

2. Soybean Market Analysis

2.1 Global Market Outlook
– Current Market Size
– Demand–Supply Trends and Forecast
– Key End-use Industries
– Trade Dynamics
2.2 Regional Market Outlook (US, Europe, and Asia)
– Current Market Size
– Demand–Supply Trends and Forecast
– Key End-use Industries (where applicable)
– Trade Dynamics

Global Soyabean Market Outlook

The global soybean supply has been witnessing a steady growth of 6.7 percent CAGR during 2013 –2018 crop years. The crop supply for 2018/2019 is expected to improve by 3.5 percent against the current crop year 2017/2018
The anticipated increase in supply is primarily due to high-ending stocks for 2017/2018
Tight soybean meal has been witnessed lately and has been supporting the soybean demand in 2017/2018 and could also be observed in H1 2018/2019

Contract Structure

Large buyers, such as crushing mills (~85–90 percent of the global soybean supplies) procure soybean in three months contracts
The feed and food industry buyers are small scale buyers and usually opt for medium to long-term contracts

Price Benchmarking

Soybean prices and contract structures are majorly fixed by the suppliers using CBOT futures. The basis and freight costs are added to the CBOT prices based on the destination. Usually, the basis is calculated as the difference between cash and futures prices
The profit margin depends on the time of buying and selling, which is driven by the supply scenario of the given crop-year

Global Soybean Supply–Demand Analysis

In 2017/2018, the total global production is estimated to decline by 4 percent, and consumption is expected to increase by 4 percent compared to the previous year
The US and Brazil remain the largest soybean producers, accounting for about 70 percent of the global production

Market Outlook – 2017/2018

The global production and consumption of soybean from 2013 – 2014 to 2017 – 2018 grew at a CAGR of 4.5 percent and 5.5 percent, respectively
Soybean consumption is expected to grow by 4.5 percent in 2018 – 2019 crop year, and the production could improve compared to the previous year
The major soybean producing regions are the US, Brazil, and Argentina, which consist of about 82 percent of the global soybeans produce

Global Soybean Trade Dynamics

Brazil and the US are the largest soybean exporting countries, accounting for about 86 percent of the global exports, while China is the largest importer of soybean. Increase income levels and consolidated supply are expected to support 20 –30 percent growth in the soybean and its derivatives trade in the next 10 years. LATAM is expected to lead the trade growth in the upcoming years.
From 2013 – 2014 to 2017 – 2018, the global soybean trade grew at a CAGR of 7.8 percent, and the trend is expected to continue in 2018 – 2019
The top soybean exporters are Brazil and the US, accounting for almost 83 percent of the global exports, followed by Argentina, Paraguay, and Canada
The top soybean importers are China and the EU accounting for ~74 percent of the global imports followed by Mexico, Japan, and Taiwan

Procurement Insights

Best Sourcing Months

Based on the seasonality of soybean, the prices of soybeans are expected to witness the lowest levels during the months of October, November, and December in the crop-year
The soybean prices are the lowest high arrivals of soybeans crops during these months

Best Sourcing Regions

The best sourcing regions for soybeans are the US, Brazil, and Argentina
Although the prices of soybean are the lowest in Argentina (this is due to currency devaluation), there are a lot of political uncertainties in the country, which limits the sourcing preferences. Brazilian soybeans are the most expensive, and hence the US is a viable option to source soybeans

Benzoic Acid Supply Scenario Contract Structures

Soybean prices and contract structures are fixed by the US suppliers by adding CBOT Futures, basis, and freight costs. Basis is the difference between cash and future prices. Profit margin depends on the time of buying and commodity selling

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