2015 U.S Soy Global Trade Exchange

“Why I buy, What I buy, Where I Buy ”

10th September 2015

Dr. Neoh Soon Bin

Managing Director, Soon Soon Group

Malaysia

Asia’s Soybean Imports in Marketing Year 2013/14 and 2014/15 ( Mn Mt)

Source from oil world 2014/15

  2013/14 2014/15

China 70.36 73.30

Japan 2.89 2.98

South Korea 1.27 1.17

Taiwan 2.34 2.40

Thailand 1.88 1.98

Vietnam 1.55 1.68

Indonesia 1.97 2.35

Malaysia 0.58 0.64

Bangladesh 0.51 0.70

Total 83.34 87.20

Where do Asia buy Soybean from in 2014 ?

Source from Oil world 2014/15

Importing Countries

Origin of Soybean imported by Asia Countries(1000 mt)

US Brazil Argentina China Others

Indonesia 1,874.70 0 23.1 0.6 67.4

Japan 1,848.90 590.5 0.4 35.5 352.2

Malaysia 223.4 62.5 43.1 26.5 219.1

Taiwan 1,356.70 933.9 34.3 4.5 44.6

Thailand 502.7 1,220.20 81.2 0 94.3

Vietnam 697.8 538.8 151.6 0 159

S.Korea 608.1 465.5 0 72.4 116.9

Bangladesh 164.2 48.8 162.3 0 133.2

China PRC 30,028.20 32,003.80 6,003.40 0 2,363.70

Total 37,304.70 35,864.00 6,499.40 139.5 4,550.40

What are the key Quality parameters for Crush

Soybeans? How much value is attached to these key quality parameters ?

Key Quality Parameters in Crush Soybeans

• Moisture

• Protein

• Oil content

• FFA in the Oil

• Protein Dispersion Index ( PDI )

Value of Protein and moisture in soybean

1% protein or moisture is worth 1% of the price

Current price in Asia =USD 400/MT

Value of Oil in Soybean

RBD Soybean oil in Asia, price = USD 800/MT

Dehulled Soybean Meal in Asia , price = USD400/MT

Difference = USD 400/MT

1% oil = 1% x USD 400 = USD4.00/MT

Erosion of Value of FFA in Soybean Oil and Soybean

FFA of Crude

Soy Oil

% oil Refining

loss per MT of crude Soy

Oil

oil loss ( converted to Acid oil) per MT

crude Soy Oil

Loss in value per MT of crude Soy

Oil during refining

Loss in value per MT of Soybean assuming an 18% oil

yield

0.50% 0.75% 7.5kg USD 2.25 USD 0.40

1.00% 1.50% 15.0kg USD 4.50 USD 0.81

1.50% 2.25% 22.5kg USD 6.75 USD 1.22

2.00% 3.00% 30.0kg USD 9.00 USD 1.62

3.00% 4.50% 45.0kg USD 13.50 USD 2.43

Refining factor = 1.5%

RBD Soybean Oil = USD800/mt

Acid Oil = USD 500/mt

Difference: USD 0.3/kg

Quality of US, Argentine & Brazilian soybean imported by Soon Soon Oilmills in the year 2014 & 2015

Source from Soon Soon Laboratory.

Origin Year Moisture (%) Oil (%) Protein (%) FFA (%) PDI (%)

Avg Min Max Avg Min Max Avg Min Max Avg Min Max Avg Min Max

US 2015

11.9 10.4 13.5 19.3 17.8 20.8 35.6 34.1 37.0 1.33 0.90 1.82 90.0 79.9 99.4

2014

11.9 10.2 13.6 19.8 18.4 21.2 36.1 34.7 37.6 1.04 0.30 1.70 90.0 82.5 96.3

Argentine

2015

11.0 9.1 12.0 20.6 19.9 21.1 33.7 33.2 34.0 1.07 0.60 1.52 90.3 89.5 91.6

2014

11.9 11.5 12.3 20.0 19.8 20.2 34.5 33.7 35.2 1.02 0.66 1.37 78.3 - -

Brazilian 2015

12.5 11.4 14.1 20.9 19.9 21.9 34.8 32.5 36.3 2.03 1.04 2.80 86.1 81.6 90.8

2014

12.0 10.1 13.8 21.1 19.9 22.4 36.1 34.6 37.5 2.24 1.60 2.56 84.4 76.4 93.7

Relative Values of Soybean imported by Soon Soon in Year 2014

  USA BrazilDiff in Value (USD/MT) Argentine

Diff in Value (USD/MT)

Moisture 11.90 12.00 -0.40 11.90 0.00

Protein 36.10 36.10 0.00 34.50 -6.40

Oil 19.80 21.10 5.20 20.00 0.80

FFA 1.04 2.24 -0.97 1.02 0.02

Total difference in value     3.83   -5.58

Relative Values of Soybeans imported by Soon Soon in Year 2015

  USA BrazilDiff in Value (USD/MT) Argentine

Diff in Value (USD/MT)

Moisture 11.90 12.50 -2.40 11.00 3.60

Protein 35.60 34.80 -3.20 33.70 -7.60

Oil 19.30 20.90 6.40 20.60 5.20

FFA 1.41 2.03 -0.50 1.07 0.28

Total difference in value     -0.30   1.48

Discussion on relative values of Soybean

• The relative value of crush soybean from USA , Brazil and Argentina will vary from year to year

• In general US soybean have a better physical appearance, higher PDI and lower FFA in their oil

• However protein levels in US soybean fluctuate from region to region , and northern soybean have lower protein than those in the midwest and the south

• Brazilian soybean normally have higher protein levels but not so in 2015. In general their soybean have high levels of heat damage and higher FFA levels in their oils.

Q: What are the other quality parameters in

Soybean that has value?

A: Amino acids especially methionine and threonine

Value from higher Levels of Methionine and Threonine in Soybean

Amount od Dig. AA in

1mt of SBM

Extra 50%

Extra 100%

Extra 150%

Extra 200%

Methionine Kg/mt 6.7 +3.35 +6.7 +10.05 +13.4

Value of extra Methionine for SBM,

USD 39.73 +19.87 +39.73 +59.60 +79.46

Value of extra Methionine for Soybean*,

USD +14.90 +29.80 +44.70 +59.60

Threonine Kg/mt 18.7 +9.35 +18.7 +28.05 +37.3

Value of extra Threonine for SBM,

USD 43.57 +21.79 +43.57 +65.36 +86.91

Value of extra Threonine for Soybean*,

USD +16.34 +32.68 +49.02 +65.18

In 1mt of soybean meal, the amount of digestible methionine and threonine 6.7kg and 18.7 kg respectively. (Data adapted from NRC 1994)

Price of crystalline AA per kg : methionine $5.93 and threonine $2.33 (prices as at Sept 15)

*Conversion factor for value from soybean meal to soybeans X0.75

Comparison of Canadian and US Non GM IP Food

Soybeans

Comparison of US White Hilum Food Grade Soybean with Canadian IP Soybeans

Canadian IP soybean

Varietal 1 Varietal 2 Varietal 3 Varietal 4 Varietal 5

Origin Canadian USA USA USA USA USA

Moisture.% 12.1 10.2 10.1 11.0 10.1 10.9

Protein, % ( Dry basis)

43.3 43.0 41.6 43.9 43.2 40.9

Oil, % ( as is) 18.50 20.41 19.8 20.05 18.2 20.5

Seed coat appearance

Dull yellow Bright yellow

Bright and lighter yellow

Bright

yellow

Bright yellow Bright yellow

Germination test 81 97 65 90 90 61

Water uptake factor

2.13 2.2 2.2 2.0 2.1 2.1

Soymilk yield, gram

2838 2793 2925 2681 2700 2710

Tofu yield, gram 1206 1272 1157 1007 996 864

The results showed “”Varietal 1”” gave higher tofu yield than Canadian IP Soybean and “”Varietal 2”” quality is also acceptable .

Discussion

• We contract farm most of our food soybeans in Canada.

• Recently we have also tested some non-gm soybean varieties from the USA and found that the quality of some varieties are comparable to our existing source from Canada .

• We have purchased some of these varieties to test market and found that their quality to be acceptable.

• However the Malaysian market preference is still for Canadian soybean because of historical reasons and the regular promotion efforts by the Canadians on food soybean.

Thank You!

neohsb@soonsoongroup.com