As soybean farmers around the world prepare for planting season, prices for the crop will be key considerations. The Soybean Export Council (SEC) has released its latest soybean price forecast, and it is looking high.
As the world continues to grapple with a glut of soybean crops, the demand for soybean products is waning. This has led to a decrease in soybean prices, as traders and processors seek to offload their inventories. Soybean prices are expected to remain low throughout the year as traders wait for the market to clear.
Sowing Period: February – April
Harvesting Period: May – June
Crop Season: Late Kharif
Key Growing Regions
- Madhya Pradesh
- Andhra Pradesh
Production Trend And Stock Position
- Erratic and delayed rainfall in India has lowered the estimation of the Soybean crops to some extent. However, the overall production rate is expected to be much higher than in the previous season. According to a report, the overall production of soybeans would be around 10.8 million tonnes while it was 10.45 million in 2020. Nonetheless, soybean prices could still be high during this year.
- As per the latest planting report, the planted area in the state of Madhya Pradesh was 10% lower than it was last season. The national average crop yield of this year is expected to reach 0.885 tonnes/hectare., which is slightly lesser than the previous year as well. However, the result seems decent when compared to the last five years.
- Out of the overall expected production in 2021, the output in Maharashtra and Madhya Pradesh has been seen at 52.3 lakh tonnes and 48.3 lakh tonnes. The production performance in these two places has been higher than last year (41.8 lakh tonnes and 45.44 lakh tonnes).
- The market prices of the soybean market have increased much more than the MSP. According to a report, it has peaked at more than USD 1,344 per tonne. In accordance, the FAS has also revised their export estimates of the soybean mandi price for the season of 2020-21 to 100,000 tonnes. However, the 2021-22 season forecast has lowered the same to 200,000 tonnes.
Between February 2021 and August 2021, the soybean mandi rates have escalated pretty massively. However, it happened due to the shortage of products during this period. According to some reports, the price rise was pretty unsustainable and it adversely affected the poultry farmers in India as well.
- The global soybean market is expected to grow at a CAGR of 3.5% between 2021-2026. However, due to the recent supply chain disruptions due to the COVID-19 pandemic have affected the growth to some extent. This issue has reduced various other soy products like cake, oil, meal, etc.
Source: Mordor Intelligence
- The United States, Paraguay, Brazil, Canada, Uruguay, and Argentina are considered to be the largest exporters and producers in the world. According to Mordor Intelligence, they provide more than 85% of soybeans throughout the world.
- Previously, the USA was considered the largest production house of soybean in the world. However, since 2019, the overall production of soybeans has increased massively in Brazil. Such inflation in productivity can be associated with favorable weather conditions, soil quality, and availability of water.
Source: Mordor Intelligence
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