While crushing in Argentina has stagnated over the last 15 years, the growing demand for soybean oil to produce hydrotreated vegetable oil (HVO) in the United States is driving a significant expansion of its crushing capacity, resulting in a substantial increase in soybean meal production. However, this surge in supply is poised to far exceed domestic demand, triggering a 51% increase in US soybean meal exports from 2022/23 to 2026/27. It is projected that the US could export more than 19 million tons of soybean meal in the latter period.

This emerging development coincides with three consecutive years in which Brazil export volumes have surpassed domestic consumption, indicating an upward trend that is expected to intensify. Considering these factors, there is a prospective global oversupply of soybean meal, which may lead to declines in international prices of this commodity.

This situation will inevitably impact Argentine foreign trade as soybean meal represents its primary export product. Argentina possesses a distinctive industrial structure within the Up River Complex, which is the second-largest agricultural export hub globally. With contributions from the rest of South America, Argentina still maintains available productive crushing capacity that can be supplemented through imports. This potential remains irrespective of the most optimistic projections for Argentine oilseed production.

The enhancement of bovine meat, poultry meat, dairy products, and even pork meat trade holds the potential to reverse Argentina’s pork trade deficit. Argentina benefits from comparative advantages due to its fertile soils and the development of its agro-industrial sector. Moreover, Argentina possesses an abundant water supply, a critical resource for furthering livestock development. The achievement of political consensus will be pivotal for economic stability and future net positive support for agricultural producers.

In the coming years, the potential of external markets and productive capacity can compensate for potential price declines, thereby allowing livestock exports to thrive.  In conclusion, we assert that this situation presents a significant opportunity to diversify Argentina’s export basket.

• Unregistered authors: Terré Emilce, Calzada Julio
• Publishing organisation: Bolsa de Comercio de Rosario; ACSOJA; UNR
• Year of publication: 2023
• Brief introduction:

  United States is steeply increasing its oilseed crushing capacity for its growing soybean oil needs, with an installed capacity expected to increase by 28% over the 2022-2026 period. Projected with consumption trends, which aspire to grow but to a lesser extent, United States could increase its exportable supply of soybean meal by close to 50% in the next five years, due to the joint production of soybean meal and oil. Projections of global consumption of soybean meal are also showing grow at a rate below the US production-increase plans. In this sense, a potential global oversupply of soybean meal could lead to falls in the international prices of this product. This situation will have a direct effect on Argentine foreign trade since soybean meal is its main exportation product. Within this framework, potential alternatives are developed for the use of soybean meal in Argentina. We quantify scenarios for the improvement of the foreign trade of bovine meat, poultry meat, dairy products and even pork meat, with the potential to reverse the Argentine pork trade deficit. We conclude that the negative effects of the situation at the US can be lessen. In fact, this situation represents a huge opportunity to diversify the Argentine export basket.

• Thumbnail image upload (recommended):
  Title: WSRC11-4d51e9c2
• List of references:

  USDA
  Argentina Agroindustrial Council (Consejo Agroindustrial Argentino, CAA)

• Image 1 upload:
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  Caption: Figure 1
  Description: Oilseed crushing capacity and soybean meail production in the US. Projections
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  Caption: Figure 2
  Description: Argentina's crush potential
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  Caption: Figure 3
  Description: Argentina's export projections for selected agroindustrial chains
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• File 1 upload: WSRC11-fa4a6482
  Title: WSRC11-fa4a6482
• Citation:

  D'Angelo Guido, Terré Emilce, Calzada Julio, 2023. Argentina’s soybean meal: A threat or an opportunity in the sight?. Legume Hub. https://www.legumehub.eu