From almost nothing in the mid-1990’s, China’s imports of soybeans and soybean meal have expanded to more than 20 million tonnes, the world’s largest market. Driving these imports is extraordinary growth in demand for feeds and for vegetable oil. Are these trends “bubbles” that could lead to over investment or are they likely to be persistent, long-term mega trends?

This study will integrate detailed commodity supply/demand fundamentals with an extensive and intensive description and economic/business evaluation of the value chain. The detailed analysis will be developed “on the ground in China” and integrated through cogent desk research.

Please join Informa Economics and the National Grain and Oil Information Center in this comprehensive multi-client study that will examine the entire Chinese oilseed complex and reach conclusions that will be critical to long-term strategic positioning at your firm.

Project Overview

This study will combine the expertise of the National Grain & Oil Information Center (NGOIC) of China with the global analytic capability of Informa Economics, Inc. (Informa)--groups that have been monitoring and evaluating growth trends in China for decades. In response to questions from Informa clients, the two organizations will evaluate key drivers of economic growth in China to develop strong insights into the dynamics behind these markets, in the context of North American, South American and EU oilseed industries. The result will be conclusions necessary to support immediate and long-term strategic investments in organizations and companies around the globe with a stake in oilseed production, processing and trade.

The Issues: Commodity Fundamentals and Related Value Chain Detail

The key driver of soybean market growth is, of course, the macro-economy, with GDP continuing to expand at a very rapid 8% annual rate (2005 projection) or faster. As a result, incomes continue to rise and with that, meat and oil consumption, which of course fuels the growing demand for feed, as well as a desire for more efficient rations including the increased use of soybean meal in animal rations. For example, production of beef, mutton, eggs and meat have grown extremely rapidly—with pork production not only growing rapidly, but from an enormous base. However, even products that are still relatively modest consumption items are growing rapidly, including milk for example.

Average per capita consumption growth of livestock products—meat, milk and eggs— has been extremely high over the 1998-2004 period, up an average of 7.8% annually and up more than 15 pounds (product weight basis). Key aspects of these trends include:

• Extremely rapid growth of milk consumption, up an average of nearly 25% annually during 1998-04;

• Sustained rapid growth of poultry consumption, up more than 12% annually;

• Strong growth of the aquatic sector, up nearly 8% annually;

• Continued growth of the pork sector, at a somewhat more sedate pace (4.5% annual average) but accounting for a consumption increase of more than 3.2 kg/capita in consumption growth.

The rapid growth of the poultry and aquatic sectors have been key drivers of increased soybean meal demand, although in absolute terms pork is still king, however, and thus remains an important component for Chinese soybean meal consumption. The milk industry is the fastest growing protein sector, which likely will mean expanded soybean meal usage from that sector for years to come.

At the same time production and consumption of livestock products is growing rapidly, feed rations are becoming more balanced. Key trends include:

• Feed use is growing rapidly, an average of 3.4% per year for 1993-2004.

• Consumption of corn and corn by-products is growing even more rapidly than the total, up an average of 2.9% and 6.5% respectively. These trends are projected to continue.

• Use of soybean meal is growing even more rapidly than the total, up an average of nearly 11% annually, and is pushing the percent of the total ration accounted for by soymeal steadily higher, from 8.6% in 1993 to 18% in 2004. This trend is expected to continue. Increases of soybean meal are growing more rapidly than livestock production, indicating that the industry fully appreciates the value of better-balanced rations.

• The rapid growth of soybean and soybean meal use can be seen in Figure 1. Not only is the role of soybean meal growing in feed rations, but it is increasingly imported in the form of soybeans and crushed in China. The production of domestic soybeans is growing much more slowly than use, as well.

This is a unique opportunity to get inside first hand knowledge of this dynamic sector of the global agriculture economy.  The overlay of Informa's oilseed analysis and the projected outlooks will give participating companies and organizations unique insights into an area that will be critical to future strategy development.  The project initiation form below will enable you to be a participant in this exciting work.  We hope to see you in Memphis for the kick-off meeting!

The entire prospectus in pdf form

You may e-mail info@informaecon.com for more information....