market for proteins and oilseed crops · 2019. 11. 22. · market food market • biodiesel...

International Grains Council

Market for proteins and oilseed crops

Arnaud Petit



Soyabeans: A tighter global balance sheet in view in 2019/20 – largely on a heavily reduced US crop

Diminished US crop outlook tightens the world S&D balance sheet

Supply & demand summary

• With US acreage set to contract by14% y/y, and with yields belowtrend, global production to declineby 18m t y/y.

• Consumption gains of 2% y/y wellbelow par on impact of ASF inChina.

• Steep fall in carryovers likely,largely on a heavy drawdown in US.

• Trade prospects highly uncertainuntil there is clarity on China’sneeds. Other buyers too small tofully compensate.

• Brazil’s exports could recover in2020/21 (Feb/Jan), but hinges onfirmer Chinese demand and howUS-China trade dispute evolves

m t 16/17 17/18 18/19 19/20 y/y

(est.) (f'cast) change

Opening stocks 34 48 44 50 + 13.7%

Production 352 341 359 341 - 5.1%

Total supply 386 389 404 391 - 3.0%

Total use 338 345 353 360 + 1.8%

of which: Crush 295 302 311 316 + 1.5%

Food 18 19 19 20 + 5.4%

Feed 16 14 13 14 + 0.9%

Closing stocks 48 44 50 32 - 36.4%

Major exportersa)

22 16 31 16 - 48.3%

Trade (Oct/Sep) 148 153 150 151 + 0.3%

a) Argentina, Brazil, USA


Soyabeans: Highlighting why global production – and stocks – are expected to contract in 2019/20

0

25

50

75

100

125

150

09/10 11/12 13/14 15/16 17/18 19/20

Canada

US

m t

- 25 m t

0

10

20

30

40

50

60

09/10 11/12 13/14 15/16 17/18 19/20

m t

+ 2 m t

Other countriesNorth America South America

0

25

50

75

100

125

150

175

200

225

09/10 11/12 13/14 15/16 17/18 19/20

Others

Argentina

Brazil

m t

+ 5 m t


Soyabeans: Global use growth in 2019/20 again below par on slower demand in China….who can compensate?

0

50

100

150

200

250

300

350

400

09/10 11/12 13/14 15/16 17/18 19/20

Other Crush

m t

China

Other Asia

Major exporters

EU

World

-8 -4 0 4 8 12 16

Five-yearaverage

19/20

18/19

m t, annual change in total use


Given negligible production, EU imports of soyabeans and meal are big……albeit with minimal growth in recent years

10

15

20

25

30

09/10 11/12 13/14 15/16 17/18 19/20

Soyabeans

Rapeseed/canola

m t

However, EU processing of soyabeans hasexpanded in recent years as rapeseed/canolacrush has dwindled against the backdrop ofmuch tighter supplies

0

10

20

30

40

09/10 11/12 13/14 15/16 17/18 19/20

Soyameal

Soyabeans

m t


Trade data highlight the importance of the EU market to South American suppliers in particular

0

5

10

15

20

25

14/15 15/16 16/17 17/18 18/19

Others

Paraguay

US

Brazil

Argentina

xxx

m t

0

5

10

15

20

25

14/15 15/16 16/17 17/18 18/19

Others

Ukraine

Canada

US

Brazil

xxx

m t

Brazil and the US dominate the market forsoyabean imports, while Canada & Ukraineenjoy moderate market shares

Argentina and Brazil account for bulk ofsoyameal arrivals, with only marginalvolumes sourced from Paraguay and the US


World soyabean and products markets – some points to consider

A much tighter global balance sheet by way of a heavily reduced US crop.

This is despite the impact of African Swine Fever and, to a lesser extent, the ongoingtrade dispute on Chinese and world demand.

However, prospects for supply and demand are tentative since South Americanplanting only just underway.

A resolution to the US-China trade dispute could have big ramifications for worldtrade – leading to a big shake up of shipment flows.

Could the US regain lost market share in China to pre-dispute levels and how wouldthis affect Brazilian export prospects?

In Brazil, the government is planning to boost biodiesel production and this wouldrequire expanded processing to produce soybabean oil supplies. Consequently, therecould be less oil for export but more soyameal for shipment to global markets

In Argentina, how will recent economic and political events shape agriculture?


Rapeseed/canola: World output and consumptionforecast to contract by 5% y/y Canada is one of global key

producers, but outputs varysignificantly across provinces; since2018/19, it is also the worlds’slargest producer.

Due to dryness and adverse weatherconditions, outturn in Australia isexpected to drop below average.

Amid a record production, Ukraineincreased its exportable supplies;

In Russia, domestic demand is thedriving factor of rising output.

2020/21 prospects in the EU remainuncertain. Area could recover toaround 6.0m ha but seasons ofdisappointing outturns could containupside.

Ukraine completed winter sowings onabout 1.1m ha, with final outcomedependent on winterkill. Drynesscaused some concerns.

m t 16/17 17/18 18/19 19/20 y/y

(est.) (f’cast) change

Opening stocks 5.9 \5.0 6.9 7.1 + 3.2%

Production 69.8 74.7 72.2 68.8 - 4.6%

Total supply 75.7 79.7 79.1 75.9 - 3.6%

Total use 70.7 72.9 72.0 68.7 - 4.5%

of which: Crush 67.8 69.9 68.7 65.5 - 4.7%

Feed 2.2 2.2 2.3 2.3 -

Food 0.6 0.7 0.9 0.9 -

Closing stocks 5.0 6.9 7.1 7.2 + 1.6%

Major exporters a) 1.6 3.4 5.0 5.5 + 10.0%

Trade (Jul/Jun) 17.1 16.1 14.9 15.2 + 1.8%

a) Australia, Canada, Ukraine

Supply & demand summary


Rapeseed: With declines seen in most key EU producers, 2019/20 crop forecast at lowest since 2006/07

0

1

2

3

4

5

6

France Germany Poland UK Czech Rep. Romania Bulgaria

5-yr. ave. 18/19 19/20 Column1

0

4

8

12

16

20

24

EU

m t m t


Rapeseed/canola: EU consumption to drop amid reduced output and ample soyabean supplies

0

5

10

15

20

25

30

10/11 11/12 12/13 13/14 14/15 15/16 16/17 17/18 18/19 19/20

Feed Food Crush Series4m t


Rapeseed/canola: Gains in major exporters’ stocks driven by a decline in exports from Canada

0

2

4

6

8

10/11 13/14 16/17 19/20

OthersMajor exporters (excl. Canada)CanadaFive year average

m t

0

2

4

6

8

10

12

10/11 13/14 16/17 19/20

Exports Stocks

Canada – Exports vs stocksWorld inventories


Rapeseed/canola: Trade is mostly shaped by demand from China and the EU

0

5

10

15

20

10/11 13/14 16/17 19/20

Canada Australia

Ukraine Others

Five year average

m t

0

5

10

15

20

10/11 13/14 16/17 19/20

China EU Others

m t

Major importersGlobal trade (Oct/Sep)


Potential factors influencing the rapeseed/canola market

Food market• Biodiesel production in South America may potentiall cause a shortfall

of soyaoil in the world market;

Feed market• How may the aquaculture sector alleviate the slowing in demand for

protein meal from the red meat (beef and pork) sector in the EU ?

• Future policy developments in Argentina can impact EU sourcing of soyameal. How could Brazil take advantage of it ?

Biofuels• Current developments in the global biodiesel market could be

detrimental for rapeseed oil demand as palm oil is currently deemed to be more competitive.


Dry peas: Production to rebound in 2019/20, up 10% y/y.

In Canada, production to climb to a

three-year high, amid increase in area

and improved yields.

In the EU, growth in production is

mainly underpinned by higher y/y yield

forecast.

Russian output weighed by slightly

smaller area estimate.

t/ham t 14/15 16/17 17/18 18/19 19/20 y/y


Major exporters

Canada 4.8 4.1 3.6 4.7 + 30.5%

EU 2.3 2.8 2.0 2.2 + 11.4%

Russia 2.2 3.3 2.3 2.1 - 10.1%

Ukraine 0.7 1.1 0.8 0.6 - 23.9%

USA 1.3 0.6 0.7 1.0 + 39.9%

Selected others

Australia 0.4 0.3 0.2 0.3 + 67.2%

India 0.7 1.0 1.0 1.0 + 0.7%

World total 15.1 16.1 13.1 14.4 + 9.7%

0.0

0.5

1.0

1.5

2.0

2.5

0

2

4

6

8

10

12

14

16

18

10

/11

11

/12

12

/13

13

/14

14

/15

15

/16

16

/17

17

/18

18

/19

19

/20

m t

Yields>


Chickpeas: After a sharp increase, output to fall by 11% y/y in 2019/20.

Key points m ha y/y

India 10.1m t -11%

Lower yields as well as decline in sown area.

Australia 0.3m t +1%Tighter availabilities to underpin gains, but toremain well below the five-year average.

USA 0.3m t -44%

Fall in seeded area as well as unfavourableconditions during sowing period.

Canada 0.3m t -16%Dropped in acreage because of lower farmgateprices in the previous season and largecarryovers.

World 14.5m t -11%Expected to remain above the near-termaverage.

0.0

0.2

0.4

0.6

0.8

1.0

1.2

0

2

4

6

8

10

12

14

16

18

10

/11

11

/12

12

/13

13

/14

14

/15

15

/16

16

/17

17

/18

18

/19

19

/20

Others Canada

USA Australia

India Yields >

m t


Lentils: Production to climb for the second consecutive year, to 6.6m t

m t 15/16 16/17 17/18 18/19 19/20 y/y


Major exporters

Australia 0.7 0.5 0.3 0.3 + 6.2%

Canada 3.2 2.6 2.1 2.5 + 20.4%

USA 0.6 0.3 0.4 0.3 - 22.1%

Selected others

India 1.0 1.2 1.6 1.6 - 3.8%

Turkey 0.4 0.4 0.4 0.4 - 5.6%

World total 7.1 6.7 6.3 6.6 + 4.3%

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

0

1

2

3

4

5

6

7

8

10

/11

11

/12

12

/13

13

/14

14

/15

15

/16

16

/17

17

/18

18

/19

19

/20

m t

Yields>

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

10

/11

11

/12

12

/13

13

/14

14

/15

15

/16

16

/17

17

/18

18

/19

19

/20

Canada

India

Australia

USA

m t


Pulses: Trade to climb by 3% y/y in 2019, to 16.6m t.

Exportsm t

(Jan/Dec)% change

y/y

Canada 5.8 +10

Australia 1.4 -8

Myanmar 1.5 +4

USA 1.0 +9

Russia 1.3 -1

Argentina 0.5 -90

2

4

6

8

10

12

14

16

18

20

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

m t

5-year average


Pulses: Trade mostly driven by demand from Asia.

0

2

4

6

8

10

12

14

16

18

20

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Other*

S America

N&C America

Europe

Africa

Asia

m t

*Includes CIS, Oceania, unspecified.

Imports by region


Pulses: Changing market trend

0.0

1.0

2.0

3.0

4.0

5.0

6.0

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Imports

Exports

m t

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Imports

Exports

m t

India China


Pulses: Trade in different types of pulses

Dry peas trade to decline by 4% y/y on reductions in buying by the EU, China and the USA.

Chickpeas trade seen slightly higher y/y on firm demand from Turkey and Pakistan.

Growth in lentil trade by 17% y/y, mainly underpin by improved demand from India.

0

1

2

3

4

5

6

7

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Dry peas

Lentils

Chickpeas

Kidneybeans

Others

m t


Pulses: Cumulative Indian exports upto August 2019.

0

100

200

300

400

500

600

Jan Feb Mar Apr May Jun Jul Aug

2013-17 ave.

2018

2019

'000 t

• Canadian lentil prices considered to be competitive in the global market.

• Tighter domestic pigeon pea supplies


Pulses: Futures market

India – NCDEX Chickpeas

11000

13000

15000

17000

19000

21000

23000

No

v-1

8

De

c-1

8

Ja

n-1

9

Fe

b-1

9

Ma

r-1

9

Ap

r-1

9

Ma

y-1

9

Ju

n-1

9

Ju

l-1

9

Au

g-1

9

Oc

t-1

9

No

v-1

9

JPY/30kg

Last 12 months

Previous 12 months

3000

3500

4000

4500

5000

5500

6000

6500

7000

No

v-1

8

De

c-1

8

Ja

n-1

9

Fe

b-1

9

Ma

r-1

9

Ap

r-1

9

Ma

y-1

9

Ju

n-1

9

Ju

l-1

9

Au

g-1

9

Se

p-1

9

Oc

t-1

9

No

v-1

9

INR/100kg

Last 12 months

Previous 12 months

Market mainly supported by low arrivals of the 2019/20 crop

Japan – TOCOM Adzuki Beans

Strengthened on bad weather in main growing region and limited nearby availability


Pulses: Future opportunities/challenges

More awareness of the importance of pulses in balanced diet.

Growing demand for plant based protein food.

No financialisation of the market.

Data information and business needs not yet align.

market for proteins and oilseed crops · 2019. 11. 22. · market food market • biodiesel...

Documents