Internationally, soybean meal exports have traditionally been led by Argentina, Brazil, and the United States. Since the 1997/98 campaign, Argentina has remained the world’s leading exporter.

Soybean Meal Statistics

However, during the 2022/23 campaign, the country suffered its worst drought in 60 years, severely impacting its production and milling capabilities. As a result, Brazil overtook Argentina as the leading soybean meal exporter for the first time in 25 years.

Nevertheless, data for the first half of 2024 shows a notable recovery in the volume of soybean meal exported, according to a report from the Rosario Board of Trade, signed by analysts Matías Contardi, Natalia Marín, and Emilce Terré.

Soybean Meal Statistics

Argentina has managed to increase its exports by 46% compared to the first half of 2023, due to a return to normal production levels. However, despite the year-over-year growth, the local production dynamic is overshadowed by its closest competitors in the medium term.

“It is important to note that this moderate growth is influenced by an idle capacity that has remained close to 42% during the last three years of normal production. Despite having the infrastructure to increase soybean milling, no significant rise in soybean production has been observed in recent years,” it states.

Compared to Brazil and the United States, Argentina has fewer processing plants, but these are larger and more efficient, making its theoretical annual processing capacity comparable to its neighboring country and not far from that of the Americans.

Additionally, unlike other competing countries, Argentina’s industry is geographically concentrated, mainly around the city of Rosario, which houses nearly 80% of the national crushing capacity.

In the last 10 years, it has been observed that about half of the annual crushing occurs during the first half of the year in Argentina, Brazil, and the United States. The latter two show a trend of sustained and relatively stable growth over the analyzed period. In contrast, Argentina has shown greater variability over the past decade.

Decline in Brazil’s Soybean Crushing

During the first half of 2024, Brazil experienced a decrease in soybean crushing, a deviation from the growing trend of previous years. This decline can be attributed to a combination of short-term factors affecting the sector.

On one hand, the industry has faced less favorable margins, mainly due to an increase in operational costs. This cost increase results from new tax changes implemented at the beginning of the year, which have pressured the profitability margins of processing plants. Additionally, the sector has had to deal with the effects of the historic flood in the state of Rio Grande do Sul, a key soybean-producing region.

These are exceptional rather than typical occurrences, as market expectations are favorable for the remainder of the year.

Why Argentina Has a Greater Presence in the International Soybean Meal Market

Generally, the United States and Brazil significantly surpass Argentina in terms of total soybean crushing volume. However, this difference does not directly translate into a greater presence in the international export market.

The main reason lies in the domestic consumption patterns of each country, as both the United States and Brazil allocate a substantial portion of their production to the domestic market.

However, year after year, their international market share has tended to increase in line with a strengthened buying market.

Global Soybean Meal Imports

Considering commercial estimates for the 2023/24 campaign, over a period of fourteen years, global soybean meal imports are expected to have increased by 25%, while exports from the United States and Brazil have steadily risen at an average annual rate of 4% and 3.2%, respectively, during the same period.

In contrast, Argentina has seen a decrease in its average annual export rate of soybean meal by -0.9% over the last fourteen years.

Argentina is No Longer the Undisputed Leader

Although Argentina currently holds the position as the leading player in the international soybean meal trade, it no longer does so undisputedly and has lost ground in a continuously growing market.

To illustrate the situation further, in the context of missed opportunities, current estimates suggest that the Southeast Asian region’s soybean meal imports will increase from 11 million tons in the 2010/11 commercial cycle to 19 million tons in 2023/24.

This region, which has shown remarkable dynamism for over a decade, is emerging as one of the most promising markets for soybean meal in the future, potentially accounting for one-third of global soybean meal imports by 2028.