Global Markets: Oilseeds – Consumption Grows Despite Slowing Trade, Production

Global oilseed production is forecast to decline slightly in 2019/20 in contrast to the steady rise observed over the past several years. Soybean production is projected to fall as reduced plantings and harvest in North America more than offset increases in all other regions. Sunflowerseed production is also forecast to fall as flat or declining production is expected in all major producing regions. Both rapeseed and palm kernel output are expected to grow with rapeseed production nearly flat to rising in most regions while palm kernel rises with growing palm oil.

Global oilseed consumption is forecast to rise as growing demand for protein feeds continues to drive the market. African Swine Fever in China and Vietnam continues to slow previous strong demand growth in these markets. However, low oilseed prices and expected strong global demand for meat and fish drives consumption elsewhere. Soybean consumption, representing 60 percent of the oilseed sector, will continue to be the driving force in total volume growth.

Global oilseed trade is forecast to rise slightly in 2019/20 yet remains below the record volume set in 2017/18. Limited import growth in China and Vietnam are the primary drivers with annual trade growth expected to reach 1 percent in the coming year versus near 6 percent earlier in the decade.

Global oilseed ending stocks are forecast to remain relatively unchanged as higher rapeseed stocks nearly offset flat to lower carry-over for all the remaining major oilseeds.

Global protein meal consumption is forecast to grow 2 percent in 2019/20, a bit faster than the prior year yet still about half the level of growth observed earlier in the decade. Weaker growth in China is the principal factor in the slower pace of consumption. Global protein meal trade is projected to show strong growth in 2019/20 at 2.5 percent though down from the current year forecast of 5 percent growth from 2017/18 resulting from the recovery in Argentine soybean crush and meal trade.

Global vegetable oil consumption is projected to expand, though at a slightly slower pace than in recent years. Food use consumption is forecast to grow 2.8 percent, down from the 3.3 percent pace observed in recent years. Industrial use, primarily for fuel, is projected to slow in 2019/20. Global vegetable oil trade is forecast to grow on pace with consumption with palm oil’s share of trade remaining nearly constant at just over 60 percent. With global vegetable oil production failing to keep pace with consumption, global vegetable oil stocks as a percent of consumption is expected to decline to below 10 percent in 2019/20, the lowest since the mid- 1990’s.


Global soybean production in 2019/20 is forecast to reach 355.4 million tons, a decline of 6.7 million tons below the 2018/19 production estimate. This decrease primarily reflects a reduction in planted area and return to trend yield in the United States. The reduced area is in response to low prices, high carry-over, weather issues, and uncertainty over trade with China. Production increases are expected in Brazil, China, Paraguay and India totaling 8.7 million tons following increases in harvested area. Despite the smaller area in the United States, global harvested area is forecast to expand nearly 1 percent to a record 126.7 million hectares.

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Despite the decline in global production, total global soybean supply is projected to rise 1.5 percent with larger carryin from 2018/19, primarily from the United States. Continued growth in global demand will likely balance supply growth this year leaving global ending stocks nearly unchanged from 2018/19. The global stocks/use ratio will fall slightly, but will remain at a healthy level.

Global soybean trade is forecast to rise less than 1 percent in 2019/20 while remaining below 2017/18’s record level. U.S. exports are projected to rise from the current year’s low level, more than offsetting declines from most other exporters. Brazil and the United States will continue to be the main global soybean suppliers accounting for nearly 85 percent of global trade. China is projected to remain the leader in global imports at 58 percent of trade, though down from a peak of 65 percent as recently as 2016/17.

Global soybean meal imports are forecast to grow 3.5 percent in 2019/20 in line with growing protein feed demand. Argentina continues to expand exports following the reduced meal output corresponding with the 2017/18 drought and boosting its global export share to a projected 45 percent in 2019/20, near its long-term average. Imported soybean meal, as a share of global consumption has leveled off at near 27.5 percent after declining from roughly a third of consumption in the early 2000’s reflecting mostly the slowdown in China’s meal consumption. Global soybean meal consumption is forecast to grow 2 percent with the largest volume increases in North and South America and Southeast Asia.

Soybean oil exports are forecast to rise 5 percent in 2019/20 with total volume projected to reach 11.8 million tons and equaling the record set in 2015/16. Growing exportable supplies resulting from an increase in Argentine production will help propel sales into the new year, assisted by growing demand and competitive pricing. Ending stocks will decline only slightly, but remain significantly below the 5-year average.

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