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Oct 2, 2010
Global Supply, Demand and Price Prospects of Major Oilseeds, Oils and Oilmeals
Presentation at Soya Summit in Minneapolis, 6 Oct 2010
Presentation at POC 2010 in Kuala Lumpur, March 10, 2010
Thomas Mielke, Executive Director of ISTA Mielke GmbH,
Global Market Research on Oilseeds, Oils and Meals,
E-mail <[email protected]>
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Oct 2, 2010
� ISTA Mielke GmbH was founded in 1958
International STatistical Agricultural Information
� Independent; no supply & demand engagement, no involvement in trading (futures + cash);
� Recognized worldwide as the leading private authority for globalresearch and market analyses for oilseeds, oils & fats and oilmeals (with clients in 100 countries)
� Providing thoroughly elaborated and unbiased information of the past and current global supply, demand and price developments as well as forecasts & projections. www.oilworld.de
� The results are given in several publications under the name “Oil World” as well as in special studies (upon request)
Background to ISTA Mielke where OIL WORLD is produced
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Oct 2, 2010
� Edible oil prices increasing sharply since July 2010 (despite record soya crop in US)
� High volatility ahead
� Some setback possible nearby
� We expect additional price strength in 2010/11
� Yesterday crude mineral oil rose to US $ 85 in Europe
Daily prices from 1 Jan 2010 until 1 Oct 2010
Jan10 Feb Mar Apr Jun Jly Aug Sep
700
750
800
850
900
950
1000
1050
1100
1150
1200
1250Daily Prices of 4 Oils in Rotterdam (US-$/T)
Rape oi l, Dutch
Sun oil, EU
Soya oil , Dutch
Crude palm oil, cif N.W. Eur.
The Global Oils/Fats Market is in a Production Deficit
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Oct 2, 2010
The Outlook of Soybeans & other Oilseeds
Soybeans Dominate the Global Oilseed Market
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Oct 2, 2010
• Dominance of Soybeans with a production of 259 Mn T in 2010/11 (down 2 Mn T)
• Rapeseed crop to drop by 4 Mn T in 2010/11
• Sunflowerseed production 2 Mn T below earlier estimates
Soybeans 59%
Rapeseed 13%
Sunflowerseed 7%
Cottonseed 10%
Groundnuts 5%
Other 6%
2010/11 = 440 Mn T
Other ctries 12%
China 5%
Argentina 20%
Brazil 26%
U.S.A. 37%
Soybeans = 259 Mn T
Global Production of 10 Oilseeds
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Oct 2, 2010
96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11
90
110
130
150
170
190
210
230
250
270
290
10 Oilseeds: World Production (Mn T)
Soybeans
Other 9 oilseeds
• World output of soybeans doubled since 1994/95
• 9 other oilseeds have grown 40%
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Oct 2, 2010
93/94
94/95
95/96
96/97
97/98
98/99
99/00
00/01
01/02
02/03
03/04
04/05
05/06
06/07
07/08
08/09
09/10
10/11
406080
100120140160180200220240260280300
World Production (Mn T) and Area (Mn ha)
SOYBEANS
Area
Production
• World supplies of soybeans are ample and likely to remain ample in Sept/Febr 2010/11
• Strong demand for soya oil ...
• .. require a boost in soya crush by around 18 Mn T in 2010/11
• Ample supplies of soya meal
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Oct 2, 2010
92/93 94/95 96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11
0
10
20
30
40
50
60
U.S.A. China
EU-27 Brazil
Argentina
Soybeans : Crushings in Key Countries (Mn T)
• World soybean crushings to surge by around 18 Mn T in 2010/11
• Outstanding growth in China - -increasing steeply from 4 Mn T in 1991/92 to 53 Mn T in 2010/11
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Oct 2, 2010
10 OILSEEDS: World Supply and Demand ( Mn T )
Forecast Change2010/11F 2009/10 09/10 08/09 07/08 06/07
Opening stocks 81.0* +21.3 59.7 70.0 83.3 72.9
Production . . . . . . 440.4* +0.2 440.2 393.9 390.1 406.0 thereof soybeans 258.9* -1.8 260.7 211.3 220.5 237.6 Sunseed . . . . . . 32.2* +/- 0 32.2 34.8 29.3 30.4 Rapeseed . . . . . 56.8* -3.8 60.6 58.4 48.6 47.7
Total supplies . . . 521.4* +21.4 500.0 463.9 473.4 478.9
Disappearance. . . 439.6* +20.7 418.9* 404.2 403.5 395.6 thereof soybeans 256.4* +18.5 237.9* 225.4 232.3 225.5 Sun+Rapeseed . 91.1* -2.7 93.8* 90.1 79.2 79.7
Ending stocks . . . 81.8* +0.8 81.0* 59.7 70.0 83.3 thereof soybeans 70.8* +2.5 68.3* 45.5 59.6 71.4
St ocks/usage 18.6% 19.3% 14.8% 17.3% 21.0%
10 OILSEEDS: World Supply and Demand ( Mn T )
Forecast Change2010/11F 2009/10 09/10 08/09 07/08 06/07
Opening stocks 81.0* +21.3 59.7 70.0 83.3 72.9
Production . . . . . . 440.4* +0.2 440.2 393.9 390.1 406.0 thereof soybeans 258.9* -1.8 260.7 211.3 220.5 237.6 Sunseed . . . . . . 32.2* +/- 0 32.2 34.8 29.3 30.4 Rapeseed . . . . . 56.8* -3.8 60.6 58.4 48.6 47.7
Total supplies . . . 521.4* +21.4 500.0 463.9 473.4 478.9
Disappearance. . . 439.6* +20.7 418.9* 404.2 403.5 395.6 thereof soybeans 256.4* +18.5 237.9* 225.4 232.3 225.5 Sun+Rapeseed . 91.1* -2.7 93.8* 90.1 79.2 79.7
Ending stocks . . . 81.8* +0.8 81.0* 59.7 70.0 83.3 thereof soybeans 70.8* +2.5 68.3* 45.5 59.6 71.4
St ocks/usage 18.6% 19.3% 14.8% 17.3% 21.0%
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Oct 2, 2010
• World stocks of 10 oilseeds recovered by 22 Mn T in 2009/10
• And are set to increase further by 1-2 Mn T in 2010/11, despite the losses in rapeseed and sunflowerseed
00/01 02/03 04/05 06/07 08/09 10/11
-15
-10
-5
0
5
10
15
20
25
-200
0
200
400
600and Soybean Prices (in US-$/T)
OILSEEDS: Surplus/Deficit of Production
Mn T Soybeans, cif Rott.
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Oct 2, 2010
• Early Outlook for the 2010/11 Season for Ending Stocks:
• Oilseeds +1 Mn T
• Oils/Fats –0.5 Mn T
At the End of the Season1997 1999 2001 2003 2005 2007 2009 2011
8
10
12
14
16
18
20
22
17 oils & fats
10 oilseeds
World Stocks in Percent of Annual Usage
%
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Oct 2, 2010
• Soybeans at 2-year high in Sept 2010
• Wheat at a 2-year high in August
• Corn also rallied to a 2-year high
• Cotton reached a 19-month high in mid-Sept
Daily futures from 1 Nov 2009 until 5 Oct 2010Nov DecJan10Feb Mar Apr May Jun Jly Aug Sep
400
500
600
700
800
900
1000
1100
1200
CBOT: Daily Soybean & Wheat Futures (c/bu)
Soybeans Nov 2010
Wheat Dec 2010
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Oct 2, 2010
Daily futures from 1 Nov 2009 until 1 Oct 2010Nov09 DecJan10Feb Mar Apr May Jun Jly Aug Sep
240
250
260
270
280
290
300
310
320
CBOT: Daily Soya Meal Futures ($/ST)
50-day moving average
Dec 2010
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Oct 2, 2010
Daily futures from 1 Nov 2009 until 1 Oct 2010Nov09 Dec Jan10Feb Mar Apr May Jun Jly Aug Sep
36
38
40
42
44
46
CBOT: Daily Soya Oil Futures (c/lb)
Dec 2010
50-day moving average
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Oct 2, 2010
Where are we going from here ?
Despite current ample supplies, prices of soybeans and
oil are supported by :
� Bullish Impacts from grains. Fight for acreage is
going to intensify in 2011. Heavy speculative buying during most July/Sept 2010 - - > but price rally
overdone, recently downward correction.
� But corn rallied yesterday to close to US $ 5.00 on
concern that the US crop may be reduced by 2% this
Friday
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Oct 2, 2010
Where are we going from here ?
Despite current ample supplies, prices of soybeans and
oil are supported by :
� Impacts from grains. Fight for acreage is going to
intensify in 2011. Heavy speculative participation.
� Extreme weather events in 2010 - - > the focus is now
on South America
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Oct 2, 2010
74/75 80/81 86/87 92/93 98/99 04/05 10/11
0102030405060708090
100110120130140
Soybean Crop Trend Since 74/75
Mn T
U.S.A.
Argentina, Brazil & Paraguay
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Oct 2, 2010
• Very dry conditions in Brazil & Argentina and during the July and August.
• Very good rains in Argentina in Sept, but still drought in Central Brazil
• Prospects indicate drier than normal conditions in Nov/Jan 2010/11 –caused by La Niña.
South America : In Brazil the Soybean Production Prospects Have
Deteriorated for the Crop in Early 2011
ARGENTINA : Rainfall in % of normalSept Aug July June May
2010p 2010 2010 2010 2010 Buenos Aires (12 stations) 161% 24% 113% 157% 338%
Santa Fé (5 stations) . . . 172% 44% 88% 13% 198%Córdoba (5 stations) . . . . 170% 16% 1% 45% 74%
Entre Ríos (2 stations) . . 94% 56% 211% 43% 158% La Pampa (2 stations) . . . 253% 65% 57% 87% 71%
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Oct 2, 2010
93/94 96/97 99/00 02/03 05/06 08/09 10/11
0
2
4
6
8
10
12
14
16
18
20
and Grain Plantings ( Mn ha )
ARGENTINA: Development of Oilseed
Grains
Other Oilseeds
Soybeans
• Soybeans the by far dominant crop in Argentina
• Steep expansion at the expense of other crops,
• . . but lack of rotation
• Total cultivated area boosted by 3.4 Mn ha or 13% in past 4 years
• . . as grassland cattle diminishing
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Oct 2, 2010
- 7 Mn T
• In Mato Grosso soybean plantings delayed by 3 weeks
• There are considerable supply risks ahead.
• In our preliminary estimate we expect South American soybean production to drop by 6-7 Mn T in early 2011.
South American Soybean Production Prospects for Early 2011
SOYBEANS: Output in South America ( Mn T )
2011 2010 2009 2008 2007 Brazil . . . . 65.50* 68.69 57.17 60.02 58.73 Argentina 52.00* 54.70* 31.50* 46.20 48.30 Paraguay. 6.90* 7.48 4.15 6.12 5.86 Bolivia . . . 1.75* 1.68* 1.46 1.48 1.60 Uruguay. . 1.77* 1.94* 1.17 .90 .82 Total . . . . 127.92* 134.49 95.45 114.72 115.31
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Oct 2, 2010
Number of Days without Rainin March/Sept 2010
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Oct 2, 2010
Soil Moisture Supplies almost depletedas of early October
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Oct 2, 2010
Where are we going from here ?
Despite current ample supplies, prices of soybeans and oil are supported by :
� Fight for acreage is going to intensify in 2011.
� Extreme weather events. Focus now on S. America.
� Big crop losses in rapeseed and sunflowerseed.Plummeting world supplies of rape oil and sun oil.
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Oct 2, 2010
Rapeseed and Oil
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Oct 2, 2010
92/9393/94
94/9595/96
96/9797/98
98/9999/00
00/01 01/02
02/03 03/04
04/05 05/06
06/07 07/08
08/09 09/10
10/11
16202428323640
4448525660
World Production (Mn T) and Area (Mn ha)
RAPESEED & CANOLA
Production
Area
2010/11 World Output to Decline
Canada -1.6 Mn T
EU-27 - 1.6 Mn
Ukraine - 0.4
China - 1.0
Australia + 0.3
Strong demand
Stocks to drop
2010/11 world crush to fall for 1st time in many years
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Oct 2, 2010
• Prices in Europe relatively firmer than in Canada
Prices from 01 May 2010 until 29 Sept 2010
May Jun July Aug Sep340
360
380
400
420
440
460
480
500
520
Nearest Forward Position (US-$/T)
Daily Rapeseed & Canola Futures
Winnipeg Canola
RapeseedEuronext
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Oct 2, 2010
O c t o b e r / S e p t e m b e r 92/93 94/95 96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11
-1,2
-0,8
-0,4
0
0,4
0,8
1,2
1,6
2
2,4
Annual Change (Mn T)
Rape Oil : World Production
First decline in 8 years
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Oct 2, 2010
92/9393/94
94/9595/96
96/9797/98
98/9999/00
00/01 01/02
02/03 03/04
04/05 05/06
06/07 07/08
08/09 09/10
10/11
16
18
20
22
24
26
28
30
32
34
36
World Production (Mn T) and Area (Mn ha)
SUNFLOWERSEED
Production
Area
Output 2010/11:
Arg. 2.6 Mn vs 2.3
EU-27: 6.9 vs 7.0
Ukraine 7.0 vs 7.3
Russia 6.1 vs. 6.5
Strong demand
Stocks to drop
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Oct 2, 2010
• World supplies of sun oil and rape oil seen declining by 1.2 Mn T in 2010/11
• In contrast to an average annual increase of 1.5 Mn T in the most recent 5 seasons
• The shortage in rape & sun oils will require unusually high increases in palm and soya oil production & usage in Oct/Sept 2010/11
• But still uncertainties in respect to production in several countries, mainly in Russia and Argentina.
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Oct 2, 2010
Where are we going from here ?
Despite current ample supplies, prices of soybeans and
oil are supported by :
� Fight for acreage is going to intensify in 2011
� Extreme weather events. Focus now on S. America
� Plummeting world supplies of rape oil and sun oil.
� Strong world demand
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Oct 2, 2010
October / September94/95 96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11
10
20
30
40
50
60
70
80
90
in Major Countries ( Mn T )
Crushings of 10 OILSEEDS
U.S.A.
China
India
EU-27
Brazil
Argentina
• World crush of 10 oilseeds to jump 17-18 Mn T in 2010/11
• Boom in world oilseed crushing - - growth of 10 Mn T p.a. in latest 4 years
• under the lead of China, S.America, the USA and the EU
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Oct 2, 2010
The annual growth rates of
world demand of oils & fats
vitually doubled since the
late nineties
The global market is
struggling since 2007 to
expand world vegetable oil
production sufficiently
World stocks of oils/fats will
still be tight at the end of
the 2009/10 season + likely
to decline further in 2010/11
86/87 89/90 92/93 95/96 98/99 01/02 04/05 07/08 10/11
0153045607590
105120135150165180
0123456789101112
Total Usage and Annual Change (Mn T)
17 Oils & Fats : World Disappearance
Annual Change
Annual Change
World Disappearance
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Oct 2, 2010
92/93 94/95 96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11
14
16
18
20
22
24
26
28
30
32
34
EU-27: Demand & Production of 17 Oils & Fats (Mn T)
[
RisingImportNeeds\
Demand
Production
• In 2010/11 EU-27 consumption details:
• Rape oil 9.7 Mn T
• Palm oil 6.3 Mn T
• Soya oil 2.9 Mn T
• Sun oil 3.5 Mn T
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Oct 2, 2010
00/01 01/02 02/03 03/04 04/05 05/06 06/07 07/08 08/09 09/10 10/11
0
2
4
6
8
10
for Bio-Fuels
for Food and other uses
Sharp Increase for Bio-Fuels (Mn T)
EU-27 : Consumption of Rape Oil
67%
64%
50%19%
• EU usage of rape oil for bio-fuels to rise to 6.7 Mn T in 2009/10 from 5.7 Mn one year and 5.1 Mn T two years ago
• Decline in prospect for 2010/11
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Oct 2, 2010
O c t o b e r / S e p t e m b e r
94/95 96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11
0
2
4
6
8
10
12
14
16
18
20Domestic Disappearance
Production of Oils/Fats
Imports
and Imports of Oils & Fats (MnT)
INDIA: Domestic Supply & Demand
• More than 50% of domestic requirements of oils & fats were imported in past 2 years
• … compared with less 15% in the mid-nineties
• Some relief in 2010/11, but only temporary
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Oct 2, 2010
94/95 96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11
048
12162024283236404448525660
CHINA : Imports of Oilseeds and Oils & Fats
Mn T
Oilseeds
Oils & Fats
Chinese imports in Oct/Sep 2010/11:
• Soybeans 53.6 Mn T (vs 50.6 and 41.1), or 57% of world imports
• Soya oil 1.7 Mn (1.6)
• All oils and fats 10.6 Mn T (vs 10.0)
• Oilmeals 3.2 Mn (3.0)
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Oct 2, 2010
94/95 96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11
0
4
8
12
16
20
24
28
32Domestic Disappearance
Production of Oils / Fats
Imports
and Imports of Oils & Fats (MnT)
CHINA: Domestic Supply & Demand
Chinese imports in Oct/Sep 2010/11:
• Soybeans 53.6 Mn T (vs 50.6 and 41.1), or 57% of world imports
• Soya oil 1.7 Mn (1.6)
• All oils and fats 10.6 Mn T (vs 10.0)
• Oilmeals 3.2 Mn (3.0)
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Oct 2, 2010
• World output in Oct/Sep 2010/11:
• Soya oil 41.4 vs 38.3
• Palm oil 49.3 vs 46.4
• Rape oil 22.6 vs 23.3
• Sun oil 12.0 vs 12.3
• Stocks declining
• Demand rationing necessary in 2010/11
17 OILS & FATS : World Supply & Demand ( Mn T )
Forecast O c t o b e r / S e p t e m b e r
10/11F 09/10 08/09 07/08 06/07
Op'g stocks 18.68* 18.84 18.19 17.12 17.27
Production 175.83* 169.82* 163.10 159.39 152.16
Growth +3.5% +4.1% +2.3% +4.8% +2.8%
Imports 67.00* 64.88* 64.21 60.64 57.37
Exports 66.67* 65.23* 63.59 60.86 57.72
Consumption 176.72* 169.64* 163.06 158.11 151.96
Growth +4.2% +4.0% +3.1% +4.0% +4.3%
End stocks 18.12* 18.68* 18.84 18.19 17.12
Stocks/usage 10.3% 11.0% 11.6% 11.5% 11.3%
Summary of World Balance
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Oct 2, 2010
October / September98/99 00/01 02/03 04/05 06/07 08/09 10/11
90100110120130140150160170180190200210220230240
10 Oilseeds : World Crushings (Mn T)
Soybeans
9 other Seeds
• Strong world demand of veg oil for food and non-food purposes
• will boost soya oil demand and
• thus boost soybean crushings by about 17-18 Mn T in 2010/11
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Oct 2, 2010
02/03 03/04 04/05 05/06 06/07 07/08 08/09 09/10 10/11
-6
-4
-2
0
2
4
6
8
10
Production
Consumption
Growth Rates in %
SOYA OIL World Production vs. Demand
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Oct 2, 2010
SOYA OIL : World Exports ( Mn T )October / September
10/11F 09/10 08/09 07/08 06/07 U.S.A.. . . 1.40* 1.55* 1.00 1.32 .85
Argentina. 5.03* 4.47* 4.83 5.94 6.03 Brazil . . . 1.20* 1.52* 1.91 2.39 2.46
Oth ctrs. . 1.97* 1.81* 1.81 1.53 1.49
Total . . . . 9.60* 9.35* 9.55 11.18 10.83
• Exports of soya oil curbed in 2010 by rapidly increasing biodiesel production in Argentina and Brazil
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Oct 2, 2010
E n d - S e p t e m b e r
1999 2001 2003 2005 2007 2009 2011
2
4
6
8
10
12
14
16
18
20
0
2
4
6
8
10
12
14
16
1817 Oils & Fats: Stocks & Stocks/Usage
Stocks/Usage (%)
Stocks Mn T
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Oct 2, 2010
World Production of Biodiesel ( Mn T )
18.9
15.9*
14.3*
9.5
7.1
0
4
8
12
16
20
2003 2004 2005 2006 2007 2008 2009 2010
Biodiesel Output Set to Accelerate in 2010
• Sharp increase of 3.0 Mn T in Jan/Dec 2010
• Higher usage mandates come into force
• Soya, rape and palm
oils are the major
feedstocks (1st
generation)
• Will become difficult to
satisfy demand growth
for biofuels in 2011 and
in the years ahead
• Excess capacity 47 Mn
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Oct 2, 2010
• World consumption of 17 oils/fats reached 164.8 Mn T in Jan/Dec 2009:
Of which:
• Food use 123.2 (75%)
• Biofuels (biodiesel & electricity) 16.5 (10%)
• Chemical 16.7 (10%)
• Other use 8.4 (5%)
Food use Other (animal feed, etc.)
Chemicals Energy (biofuels)
Jan/Dec 2009 total: 164.8 Mn T
17 Oils & Fats: World Consumption, by Category
8.4 Mn (5%)
123.2 Mn (75%)
16.5 Mn (10%)
16.7 Mn (10%)
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Oct 2, 2010
2004 2005 2006 2007 2008 2009 2010
0
2
4
6
8
10
12
14
16
18
20
22
24
Capacities (end of the year)
Production
EU - 27 : Biodiesel Production & Capacities
Mn T
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Oct 2, 2010
2004 2005 2006 2007 2008 2009 2010
0
2
4
6
8
10
Capacity (end of year)
Production (annual)
U.S. Biodiesel Capacity & Production
Mn T
In the USA biodiesel output to decline again in 2010 due to lack of tax credit
In Jan/Aug 2010 output at 4-year low of 0.8 Mn T against 1.1 Mn
Of which soya oil 0.4 Mn T vs. 0.5
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Oct 2, 2010
ARGENTINA : Biodiesel Production, Exports & Consumption (1000 T)
January / December2011F 2010F 2009 2008 2007
Production . . . . 2500* 2000* 1180 720 180
Exports . . . . . . 1400* 1410* 1150 725 168
Consumption . . 1100* 590* 20 5 2
2003 2004 2005 2006 2007 2008 2009 2010 2011
0
500
1000
1500
2000
2500
3000
3500
Capa cities (end of the year)
Production
ARGENTINA: Biodiesel Production & Capacities
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Oct 2, 2010
Braz. Soya oil exports in Jan/July 2010:
Decline to 937 Thd T (vs 1075 a year ago)
and in Jan/Dec 2009: 1594 (vs. 2316) - -
- - due to interior biodiesel production
BRAZIL : Biodiesel Production ( 1000 T ) Jan /July J a n / D e c
Biodiesel 2010 2009 2009 2008 2007
Production . . 1160 709 1415 1030 360
Feedstock used
Soya oil. . . . 960 555 1097 830* 290*Tallow . . . . . 155 120 234 160* 50*
Cotton oil . . . 17 22 47 24* 10*Other oils . . 28 12 37 16* 10*
2003 2004 2005 2006 2007 2008 2009 2010
0
1000
2000
3000
4000
5000
Capacities (end of the year)
Production
BRAZIL: Biodiesel Production & Capacities
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ARGENTINA & BRAZIL : Increasing Biodiese lProduction and the Effects on Soya Oil (Mn T)
Soya oil January/Decemberproduction 2011F 2010F 2009 2008 2007Argentina . . . 7.50* 6.82* 5.77 6.02 6.96Brazil . . . . . 6.90* 6.70* 5.90 6.27 6.05Total . . . . . . 14.40* 13.52* 11.67 12.33 13.01
Biodiese l productionArgentina . . . 2.50* 2.00* 1.18 .72 .18Brazil . . . . . 2.30* 2.05* 1.41 1.03 .36Total . . . . . . 4.80* 4.05* 2.59 1.75 .54
Soya oil exportsArgentina . . . 5.00* 4.80* 4.56 5.07 6.50Brazil . . . . . 1.20* 1.60* 1.59 2.32 2.34Total . . . . . . 6.20* 6.40* 6.15 7.39 8.84
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Oct 2, 2010
Dominance of Palm Oil - - usage boosted from 11.4 Mn in
90/91 to 49 Mn T
in 2010/11
Consumption of 17 oils & fats more than doubled in 20 years !
Soya oil market share at 24%, of rape at 13% 2010/11
Soya Oil 23.6%Palm Oil 27.9%
Rape Oil 12.9%
Sun Oil 6.9%
PKO&CNO 5.1%
Others/An.Fats 23.6%
2010/11 -- 176.6 Mn T
Soya Oil 19.6%
Palm Oil 13.9%
Rape Oil 10.7%
Sun Oil 10.3%
PKO&CNO 5.8%
Others/An.Fats 39.7%
1990/91 - - 81.2 Mn T
World Consumption of 17 Oils & Fats
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Oct 2, 2010
Soybean 43.2%
Rape 13.5%
Cotton 14.1%
Oil Palm 5.6%Groundnut 9.1%
Coconut 4.0%
Sunflower 10.4%
Area 2010/11: 238.3 million ha
Soya Oil 28.9%
Rape Oil 15.8%
Cotton Oil 3.4%
Palm & Palmkernel Oils 38.3%
Groundnut Oil 2.9%
Coconut Oil 2.3%
Sun Oil 8.4%
Production 10/11: 143.3 million tonnes
7 OILSEEDS: World. Harvest. Area & Veg. Oil Output
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Oct 2, 2010
3,8
4,5
0,53 0,51
1,31,6
Palm oil Soya oil Rape oil
0
1
2
3
4
5
Vegetable Oil Output per ha in 2008
Indonesia
Malaysia
U.S.A. Brazil
EU
T/ha
Germany
Source: ISTA Mielke GmbH, OIL WORLD
Palm oil yields per ha are much above soya and rape oils
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Oct 2, 2010
3,400 Ha of UP’s advanced planting materials
yielded an average of 7.59 MT CPO/Ha in 2009
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Oct 2, 2010
J a n u a r y / D e c e m b e r 1997 1999 2001 2003 2005 2007 2009 2011
2468
1012141618202224
Malaysia Indonesia
Palm Oil Production in Key Countries (Mn T)
Indonesia has become
the world largest
producer of palm oil
since 2006.
In Indonesia: Slowing
down of acreage
expansion in oil palms
since 2009, partly due
to protests of
environmental groups
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Oct 2, 2010
O c t o b e r / S e p t e m b e r
92/93 94/95 96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11
-0,8-0,4
00,40,81,21,6
22,42,83,23,6
44,44,8
Annual Change (Mn T)
Palm Oil : World Production
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Oct 2, 2010
Rising Dependence on Palmoil� Palm oil to account for
58% of world exports.
� World palm oil exports
38.6 Mn T in 2010/11,
up 230% since 1997/98
� Exports of soya, rape &
sun oils shrinking by
0.3 Mn T to only 16.7
Mn T in 2010/11
� Since 1997/98 exports
of all 17 oils & fats to
double to 66.7 Mn T in
Oct/Sept 2010/11
92/93 94/95 96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11
03
6
912
1518
2124
27
30
3336
39
So y, Ra pe, S un O ils
4 Anim al F ats
Pa lm O il
9 O ther
W orld Exports until 2009/10 in Mn T
17 Oils & Fats
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Oct 2, 2010
Oilmeals
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Oct 2, 2010
94/95 96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11
70
80
90
100
110
120
130
140
150
160
170
180
12 Oilmeals: World Production (Mn T)
Other 11 oilmeals
Soyameal
Soybeans :
- - oil yield 18-19%
- - meal yield 79-80%
Insufficient supply of other oilseeds in 2010/11
requires above-average growth in soybeans
to satisfy veg oil demand,
but creates a surplus in meals
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Oct 2, 2010
94/95 96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11
70
80
90
100
110
120
130
140
150
160
170
180
12 Oilmeals: World Production (Mn T)
Other 11 oilmeals
Soyameal
World production of soya meal rising faster than for all other oilmeals.
Soya meal:
World output to increase by 14 Mn T to 177 Mn in 2010/11,
but consumption at best at 176 Mn T,
sizably raising world stocks of soya meal
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Oct 2, 2010
E n d - S e p t e m b e r
1999 2001 2003 2005 2007 2009 20113
4
5
6
7
8
9SOYA MEAL: Ending Stocks (Mn T)
Mn T
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Oct 2, 2010
O c t o b e r / S e p t e m b e r94/95 96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11
0
10
20
30
40
50
60
World
Argentina
& Dominance of Argentina (Mn T)
SOYA MEAL : World Exports
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Oct 2, 2010
SOYA MEAL : World Exports ( Mn T )October / September
10/11F 09/10 08/09 07/08 95/96U.S.A. . . . . . . . 8.50* 10.08* 7.71 8.38 5.45Argentina. . . . . 28.65* 24.25* 24.21 26.80 8.20Brazil . . . . . . . . 12.90* 12.50* 12.93 12.04 12.14China . . . . . . . . 1.20* 1.28* 1.00 .59 .10India. . . . . . . . . 3.90* 2.67* 3.60 5.37 2.53Other countries 3.45* 3.22* 3.24 3.16 1.47Total . . . . . . . . 58.60* 54.00* 52.69 56.34 29.89
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Oct 2, 2010
O c t o b e r / S e p t e m b e r98/99 00/01 02/03 04/05 06/07 08/09 10/11
-10-8-6-4-202468
101214
Year-On-Year Change (Mn T)
SOYA MEAL: World Disappearance
• World consumption of soya meal set to rise by 14 Mn T in 2010/11.
• Insufficient production of rape meal, fish meal and other oilmeals will raise the dependence on soya meal.
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Oct 2, 2010
96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11
0
1
2
3
4
5
6
Rest of World
China
multi-year low 4.6 Mn T in 2010/11 vs. 6.8 Mn T in mid-nineties
Fish Meal Consumption (Mn T)
Reduced Global Fish Meal Supplies Raise Demand for Soya Meal
• China and other Asian countries hit hard by the global shortage of fish meal.
• This is raising demand for high-protein soya meal
• Fish meal prices (now at $ 1400 in Peru) to remain at larger than usual premiums over soya meal.
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Oct 2, 2010
O c t o b e r / S e p t e m b e r96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11
20
30
40
50
60
70
EU-27 USA
China
12 OILMEALS: Usage in Key Countries (Mn T)
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Oct 2, 2010
Rapidly Rising Chinese Consumption of Oilmeals
• China has doubled its consumption of oilmeals in the past 12 years.
• Most of the growth in aquaculture, poultry and pigs.
O c t o b e r / S e p t e m b e r
98/99 00/01 02/03 04/05 06/07 08/09 10/11
05
10152025303540455055606570
12 Meals
Soybean Meal
CHINA: Oilmeal UsageMn T
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Oct 2, 2010
Concluding Statements
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Oct 2, 2010
• World supplies ample, at least in Sep/Febr 2010/11
• Weather concern in South America
• World soya crush to be boosted by around 18 Mn T in 2010/11
• We expect pressure on soya meal prices
SOYBEANS : World Supply and Demand ( Mn T )10/11F 09/10 08/09 07/08 06/07
Opening stocks 68.28* 45.50* 59.57 71.45 59.32
Production 258.92* 260.64 211.34 220.46 237.59
N. Hemisphere 129.85* 125.00 114.74 104.79 121.44 U.S.A. . . . . . . . 94.79 91.42 80.75 72.86 87.00 S. Hemisphere 129.07* 135.64 96.60 115.67 116.15
Argentina. . . . . 52.00* 54.70* 31.50* 46.20 48.30 Brazil . . . . . . . . 65.50* 68.69 57.17 60.02 58.73
Total supply 327.20* 306.14 270.91 291.91 296.91
Crush (Sep/Aug). 224.00* 205.76* 196.11 203.10 196.11 Other use . . . . . . 32.40* 32.10* 29.30 29.24 29.35
Ending stocks 70.80* 68.28* 45.50 59.57 71.45 U.S.A. Aug 31 10.00* 4.30* 3.76 5.58 15.62
Stocks/usage 27.6% 28.7% 20.2% 25.6% 31.7%
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Oct 2, 2010
From Oct 1997 until Sept 2010
'97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10
100
150
200
250
300
350
400
450
500
550
600with 10-year average Jan 1998 - Dec 2007 (in US-$/T)
Monthly Prices of Soya Meal, 48%, Brazil
Average 1998-2007: US-$ 220
Soya pellets, 48%, Brazil, cif Rott.
• Soya meal prices weaken relative oil.
• Uncertainties
• If S.American soybean output does not fall by more than 7 Mn T in early 2011,
• I expect soya meal prices to fall 10% from current levels
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Oct 2, 2010
Monthly prices from Jan 1972 until Aug 201072 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10
0100200300400500600700800900
1000110012001300140015001600
Palm oil, crude cif Rott.
Soya oil, Dutch fob ex-mill
Soya Oil & Palm Oil: Monthly Prices (US-$/MT)� Edible oil
prices now trading at a higher plateau
� Volatility to remain high
� Strong demandgrowth from the food and the bioenergy sectors
� Palm oil prices to reach $ 1000 in Rotterdam
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Oct 2, 2010
Daily prices from 1 Jan 2009 until 29 Sept 2010Jan09Mar May Jly Sep NovJan10MarApr Jun Sep
-150
0
150
300
450
600
750
900
1050
1200
-150
0
150
300
450
600
750
900
1050
1200
Daily Prices of Soya Oil & RBD Palm Olein (US-$/T)
Soya oil, Arg.fob
RBD palm olein, Mal.fob
Soya oil Premiums/discounts
• Many risks and uncertainties ahead on the supply and demand side.
• Covering policy of consumers
• With palm oil yields to recover, it is likely that soya oil price premiums widen versus palm oil in 2010/11
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Oct 2, 2010
J u l y / J u n e
94/95 96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11F
150250350450550650750850950
105011501250135014501550
Soya oil, Dutch (US-$/MT)
Rape oil, Dutch (US-$/MT)
Sun oil, EU, fob. (US-$/MT)
Palm oil crude, cif Eur.
4 MAJOR OILS : Annual Average Prices� Soya oil prices
could reach US $ 1050 in Argentina and $ 1150 in EU
� Sun oil prices could reach or exceed $ 1200 in Argentina and at the Black Sea and $ 1300 in Europe
� RBD palm olein may approach US $ 1000 fob Mal
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Oct 2, 2010
Thank Youfor Your Kind Attention !
If I can be of assistance to you in the future, you are invited to
contact me any time.
More details (by commodity and country) and background
information are given in the Oil World Monthly of Sept 17, 2010,
which can all be obtained from the Internet.
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Oct 2, 2010