Oilseed Market Tightens asEnding Stocks set to Decline in 2016/17

Global oilseed supplies are forecast up just 1 percent in 2016/17, similar to 2015/16. Soybean production is expected to grow 2 percent in response to increases in Brazil and China and a rebound in the India crop. These will more than offset reductions in the United States and Canada. Production of copra, cottonseed, and sunflowerseed are forecast to rebound, offsetting lower output in global peanut and rapeseed crops.

Global oilseed demand is forecast to rise as well, at a slightly higher rate than the previous year. Soybean crush is forecast to grow 4 percent, slightly below levels observed over the past 2 years. Other oilseed crush is forecast to grow at a relatively slower pace in the coming year though rapeseed crush, owing to reduced seed production, is expected to decline. Total soybean demand is forecast to grow in 2016/17, eclipsing global production, and leading to a decline in soybean ending stocks and global oilseed stocks in general. Ending stocks of peanuts, rapeseed and sunflowerseed, are also expected to decline, more than offsetting increases in cottonseed and palm kernels.

Global protein meal consumption (soy meal equivalent, SME) is forecast to rise slightly in 2016/17, mainly driven by demand in China and other major markets. Total protein meal consumption is expected to grow 3 percent, with increased disappearance for all meal types except rapeseed meal. Trade in protein meals is also forecast to rise, led by relatively strong growth in soybean meal exports. Growing soybean meal demand, which accounts for over 70 percent of global consumption, is the main driver in expanding trade.

Vegetable oil consumption as food is forecast to expand 3 percent in 2016/17, reflecting population and GDP growth. Food use consumption of all vegetable oils is expected to grow, led primarily by palm and soybean oil. Overall global consumption of oils in industrial applications is also forecast to grow. Industrial use of palm oil is forecast to grow in line with increasing production and strengthening domestic bio-diesel mandates in Indonesia and Malaysia. Soybean oil production is expected to increase reflecting growing supplies from increased crush while supplies of rapeseed oil will decline in response to lower seed production. Global oil ending stocks are forecast to decline 5 percent in part due to a reduction in China's rapeseed oil reserve.



Global soybean production is projected to increase approximately 8.3 million tons (over 2.5 percent) from the current year. Crop reductions in the United States and Canada are forecast to be more than offset by gains in South America, India, and China. Soybean imports are forecast to rise, driven by continuing strong demand in China, Southeast Asia, and the EU. Brazil's exports, yet again, are projected to exceed those of the United States; however U.S. market share in global soybean trade is expected to increase. Strong global demand for protein feed will lead to growing crush which will pressure stocks lower. Soybean meal trade is forecast to expand, driven by strong demand in the EU and Southeast Asia. Soybean oil trade is expected to slow, largely on India's shrinking demand due to forecast rebound in domestic oilseeds production and crush and forecast increase in global palm oil supplies. The U.S. season-average farm price is projected at $9.10 per bushel.


Global soybean production is lower this month on reduced estimates for Brazil, Argentina, and Uruguay. Exports are raised on greater shipments from the United States more than offsetting reductions in Uruguay. Global stocks are reduced significantly this month reflecting reducedproduction in South America as well as increased U.S. exports. The U.S. season-average farm priceis raised to $8.85 per bushel.


U.S. export bids in April, FOB Gulf, averaged $370/ton, up $26 from last month.

As of the week ending April 28, U.S. 2015/16 soybean export commitments (outstanding sales plus accumulated exports) to China totaled 27.1 million tons compared with 29.9 million a year ago. Total commitments to the world are 46.2 million tons, compared with 49.4 million for the same period last year.

Significant adjustments in the PSD

This month, a series of new countries/commodities have been added to the Production Supply and Distribution database. These additions will provide a more complete picture of global trade patterns while reducing the quantity of unaccounted production and trade in global supply and demand balances. Additions cover a 10-year period ending in 2016/17.

2016/17 OUTLOOK

  • Global soybeanproduction in 2016/17 is forecast to rise to a record 324 million tons. Harvested area is forecast to grow 2 percent with increases in most major producing countries except the United States where large stocks have discouraged acreage expansion. In Argentina, soybean plantings are expected to remain nearly unchanged as producers devote more area to competing crops. Despite record production, global stocks are forecast to decline 8 percent (Oct/Sep basis for Brazil and Argentina) due to continued strong demand. Much of this decline will occur in the United States, which holds about 50 percent of exporter stocks, and Argentina, where producers have been reducing strategic holdings. Global imports are forecast to rise 5 million tons with most of this occurring with China. The United States will lead gains in exports because of large exportable supplies. For Brazil, however, tight carry-in stocks will limit export growth.
  • Global soybean meal trade is forecast to grow 4 percent in 2016/17, somewhat below last year's projected 5 percent pace. A tighter supply situation and some firmness in prices will slow export growth. However, demand remains strong with limited growth potential available from other protein meals. The lower peso will continue to spur crush and exports in Argentina. However, as processors work through accumulated stocks and producers diversify their plantings, the quantity of soybeans available for crush is expected to grow tighter into 2016/17. In Brazil, strong soybean export demand is expected to limit crush expansion and meal export growth. In India, where strong domestic demand and reduced soybean production has all but eliminated its presence in meal export markets, a return to larger soybean plantings and production is forecast to raise exports in the coming year. However, with exports only forecast to reach 1.8 million tons, it will remain a regional player as export volume remains well below levels realized earlier in the decade. On the import side, prospects of reduced rapeseed crush and limited expansion in sunflowerseed crush in the EU is forecast to add to soybean meal demand. Similar import growth is forecast for most other regions, especially in Asia and the Middle East.Soybean oil exports are forecast to decline slightly in 2016/17 but total volume is expected to remain near historic highs. Exportable supplies will be limited by expanding biodiesel mandates in Brazil and tightening soybean supplies in Argentina. Demand is forecast to remain strong given the limited availability of substitutes. However, competition from palm oil is expected to increase though effects of earlier dry weather in South East Asia may keep palm oil supplies tight through the first half of 2016/17.
    • U.S. soybean exports are projected to rise 3.9 million tons to a record 51.3 million, meal exports are forecast higher at 10.9 million, up 453,000 tons, while oil exports are raised 136,000 tons to near 1.1 million.
    • Argentina soybean exports are projected to fall 750,000 tons to 10.7 million, meal is steady at 32.8 million, and oil is down 145,000 tons to 6.0 million.
    • Brazil soybean exports are projected up 700,000 tons to 60.2 million, meal exports are forecast to climb 200,000 tons to 15.4 million, and oil exports are expected to fall 170,000 tons to 1.2 million.
    • China soybean imports are projected up 4 million tons to 87 million, while meal exports remain stable at 1.8 million. Oil imports are forecast to remain unchanged at 820,000 tons.
    • EU soybean imports are projected to decline 600,000 tons to 12.6 million tons with meal imports rising 1.0 million tons to 21.7 million.
  • Global rapeseedproduction is forecast to decline 2.0 million tons in 2016/17 despite little change in area as reduced plantings in most higher-yielding countries offset a 700,000 hectares increase in India where average yields are lower. Though a modest rise in Australia's production is forecast, lower Canadian and Ukrainian output will result in a further reduction in exports from this year's reduced level. Exports are forecast to reach 12.6 million tons, 3.0 million tons below the peak level reached in 2013/14. Global ending stocks are also expected to decline 1.5 million tons from this year's projected level and at 3.4 million tons, would be less than half the level of the 2013/14 peak. Rapeseed supplies in the EU will continue to be tight leading to a further reduction in crush. Ending stocks, relative to use, are forecast to reach the lowest level since 2003/04.
    • U.S. rapeseed imports are unchanged at 340,000 tons; meal is raised to 3.9 million, and oil is up 55,000 tons to 1.7 million.
    • Canada rapeseed exports are projected to decline 759,000 tons to 8.6 million tons, meal is down 100,000 tons at 4.0 million, and oil is up 70,000 tons to 2.9 million.
    • China rapeseed imports are projected down 350,000 tons to 3.9 million and oil is down 100,000 tons to 750,000.
  • Global sunflowerseed production in 2016/17 is projected at 41.2 million tons, up 5 percent from the current season and way above the recent 10-year average. Harvested area is expected to recover moderately with increases in all major producing countries: Russia, Ukraine, the European Union, and Argentina. Global crush is projected to grow 4.5 percent as Russia, Ukraine, and the EU continue to increase processing to satisfy demand for meal and oil for both domestic and export markets. Global sunflowerseed stocks at the end of 2016/17 are forecast to decline over 26 percent to their lowest level since 1999. Global trade of sunflowerseed meal is forecast to expand slightly, driven by tight supplies of rapeseed and soybean meal. However, export growth will be limited due to strong domestic demand in the major producing countries. Sunflowerseed oil trade is forecast to rise, supported by very strong demand in India, the EU, North Africa, and the Middle East. Growing global consumption will result in global stocks declining nearly 14 percent to 1.3 million tons.
    • Ukraine meal exports are projected up 100,000 tons to 4.2 million, while oil exports are forecast to grow 400,000 tons to 4.5 million.
    • Russia meal exports are projected to grow 50,000 tons to 1.6 million, while oil exports are projected to climb 150,000 tons to 1.7 million.
    • EU meal imports are raised 400,000 tons to 3.7 million, while exports are projected to stay unchanged at 200,000 tons. Oil imports are forecast to grow 150,000 tons to 1.2 million while exports are expected to stay unchanged at 350,000 tons.
    • Turkey meal imports are forecast to grow 130,000 tons to 980,000, and oil imports are expected to increase 110,000 tons to 990,000.
    • China oil imports are forecast flat at 550,000 tons while India imports are up 250,000 tons to 1.8 million.
    • U.S. sunflowerseed and oil exports are projected unchanged while meal exports double.
  • Global palm oil production in 2016/17 is forecast to grow by 6 percent, with production in both Malaysia and Indonesia rebound as the impact of El Nino dryness wanes. Palm oil remains the dominant food oil, representing a third of total vegetable oil consumption. Industrial use for palm oil will continue to expand, particularly with stronger biofuel policies in Indonesia and Malaysia seeking an increase in domestic consumption. Lower petroleum prices have dampened the demand for alternate fuels such as biodiesel. Global palm oil trade is forecast to continue its rebound as growing output enhances the competitiveness vis-à-vis other oils, particularly in South and East Asia.
    • Indonesia exports are forecast up 500,000 tons to 25.0 million, while Malaysia is up 350,000 tons to 18.0 million.
    • India imports are forecast up 375,000 tons to 9.9 million, and Bangladesh is up 100,000 to 1.5 million tons.
    • U.S. imports are forecast to 110,000 tons to 1.2 million.
  • Global palm kernel production in 2016/17 is forecast to rise reflecting the prospects for increased palm oil production. Trade is negligible as most seed is crushed locally. Palm kernel meal trade is forecast to rise, led by New Zealand imports and their growing dairy industry. In contrast, EU imports are expected to remain flat in response to ample supplies of alternative feed ingredients. Palm kernel oil imports are forecast to drop modestly on account of slow demand in the United States.
    • Indonesia meal exports are up 300,000 tons to 4.25 million, and oil exports up 50,000 tons to 1.7 million.
    • Malaysia meal exports are up 50,000 tons to 2.5 million, while oil exports are unchanged at 1.1 million tons.
    • EU meal and oil imports remain steady at 2.1 million and 600,000 tons, respectively.
    • New Zealand meal imports are up 200,000 tons to 2.4 million.
    • China oil imports are flat at 600,000, while U.S. imports are lowered to 314,000 tons
  • Global copraproduction in 2016/17 is forecast to increase slightly, mostly on improved harvests in the Philippines and Vietnam. Global trade remains small at less than 100,000 tons and is expected to decline slightly. Copra crush is forecast to rise modestly in line with the larger production leading to a modest increase in meal and oil production. Copra meal and coconut oiltrade are forecast to remain relatively flat. Growing demand for coconut oil, with limited prospects for increasing trade, will continue to keep stocks lower and price premiums high.
    • Philippines copra meal and coconut oil exports are up at 450,000 and 840,000 tons, respectively.
    • Indonesia copra meal exports are forecast to rise to 240,000 tons while coconut oil exports remain flat at 700,000 tons.
    • South Korea copra meal imports are forecast 20,000 tons higher at 420,000.
    • EU coconut oil imports remain unchanged at 520,000 ton while imports by the U.S. rise 12,000 tons to 570,000.
  • Global peanutproduction in 2016/17 is forecast to decline slightly to 40.2 million tons. While this is the third largest on record, growing demand is expected to lead to a drawdown in global stocks. Production in the U.S. is forecast to decline this year in response to a large carry-over and producers shifting acreage back to cotton and other crops. All other major producers expect to see slight increases in production. The total tally will be 1.9 million tons higher than last year, reflecting a rebound in India and Sudan. Global peanut trade is expected to recover after declining year-over-year in 2015/16 with exports forecast to reach 3.0 million tons. In addition to higher food use, growing demand in China for crush peanuts will add to import demand. Argentina will continue to be the world's largest exporter with exports forecast to reach 800,000 tons in the coming year. The recent devaluation of the peso will augment competitiveness in the global market and help retain its dominant position in the European market.
    • U.S. exports are forecast to rise to 601,000 tons.
    • Argentina's exports are up 25,000 tons to 800,000 on larger supplies and a continued strong competitive position from a lower peso.
    • China's exports are unchanged at 500,000 tons.
    • India's exports are up 20,000 tons to 550,000 due to a rebound in production
    • EU peanut imports are nearly unchanged at 830,000 tons.
  • Although weakness in cottonmarkets pressures area planted, cottonseed production in 2016/17 is projected to recover slightly to 39.1 million tons, up 5 percent from the current year. Larger crops in India, Pakistan, and the United States are expected to more than offset reductions in China. Cottonseed crush is projected to recover leading to greater supplies of meal and oil.
    • Australia cottonseed exports are slashed by almost half to 70,000 tons.
    • U.S. cottonseed exports surge 136,000 tons to 227,000.
  • Global olive oil production in 2016/17 is forecast to recover slightly and reach almost 3.0 million tons. Production prospects in the EU are expected to improve as a rebound in the olive crop in Italy and Greece is expected. Supplies in the EU are forecast to be sufficient to meet domestic needs and allow for a steady export pace. Due to a rebound in global production both in 2015/16 and 2016/17, stocks are forecast to recover further. However, stocks are still expected to remain below historic norms.
    • EU exports are up 25,000 tons to 625,000. Imports are forecast unchanged at 175,000 tons.
    • Tunisia exports are raised 25,000 tons to 165,000.
    • U.S. imports are projected to increase 6,000 tons to 320,000.
  • Global fish mealproduction and trade is expected to remain relatively flat in 2016/17. Peru's catch is likely to remain nearly steady, yet above the three-year average. Demand is forecast to remain stable, although the premium for fishmeal over alternative protein meals is expected to remain high due to tightening global stocks.
    • Peru exports rise by 50,000 tons to 820,000.
    • Chile exports are down 15,000 tons to 260,000.
    • China imports remain constant at 100,000 tons.


  • U.S. soybean exports are raised 953,000 tons to 47.4 million reflecting stronger global demand. Soybean meal exports are raised 273,000 tons to 10.4 million on a stronger pace of trade.
  • Egypt soybean meal imports are raised 100,000 tons to 1.6 million on a stronger pace of trade.
  • Iran sunflowerseed oil imports are raised 100,000 tons to 450,000 reflecting a strong pace of trade and growing demand for soft oils.
  • Kazakhstan sunflowerseed oil imports are increased 118,000 tons to 120,000 on a new trade data source.
  • Pakistan soybean imports are raised 100,000 tons to 13.5 million reflecting a strong pace of trade and growing domestic crushing capacity. At the same time, soybean meal imports are reduced 300,000 tons to 850,000.
  • Philippines soybean meal imports are increased 150,000 tons to 2.6 million on a stronger pace of trade.
  • Turkey soybean imports are down 100,000 tons to 2.3 million reflecting a slower pace of trade.
  • Uruguay soybean exports are reduced 750,000 tons to 2.1 million following a lower production estimate.