In 1996/97, global production of the seven major oilseeds is forecast at
260 million tons, which is slightly above the previous season's level.
World soybean output in 1996/97 is expected to recover and exceed
last season's level by almost 6 percent, but to remain below the 1994/95
record. Although production prospects at this time are still tentative, the
crop currently harvested in the United States is estimated at 64 million
tons, an increase of about 8 per cent over the previous year. Brazil's
production, to be harvested in early 1997, is likely to show a strong rise
as farmers are expected to expand cultivated areas in response to favourable
prices and improved farm credit conditions. The Argentinean production might
also rise further due to a sharp expansion in the double cropped wheat/soybean
area. By contrast, indications are that farmers in China would favour the
cultivation of grains over soybeans, suggesting a decline in planted area
and a further increase in the country's deficit in soybeans and soybean-based
products.
WORLD PRODUCTION OF SEVEN MAJOR OILSEEDS
|
|
1994/95 | 1995/96 estim. | 1996/97 f'cast |
|
|
(. . . . . . million tons . . . . . .) | ||
| Soybeans | 138.4 | 124.7 | 131.8 |
| Cottonseed | 34.4 | 35.1 | 33.8 |
| Groundnuts | 28.7 | 27.8 | 28.3 |
| Sunflowerseed | 24.0 | 26.4 | 24.7 |
| Rapeseed | 30.1 | 34.9 | 31.4 |
| Palm kernels | 4.8 | 4.9 | 5.1 |
| Copra | 5.3 | 4.7 | 5.1 |
SOURCE: FAO
World output and global availability of sunflower seed are expected
to decline by about 1.7 million tons, mainly as a result of likely contractions
in output in Argentina, the United States and the countries of the former
USSR, following a shift towards wheat and maize plantings.
World production of rapeseed is foreseen to decrease by over 3 million
tons from last season's level, as a consequence of reduced plantings and/or
unfavourable weather conditions in Canada, eastern and western Europe and
China.
World cottonseed production is anticipated to contract by about 4
percent to 33.8 million tons, as cottonseed has lost area to grains or to
other oilseeds in China and India due to relatively less attractive prices
of lint.
An increase of 7 percent is foreseen in the production of copra, owing
to favourable rainfall and the expected recovery in the biological yield
cycles in the Philippines and Indonesia. Likewise, production of palm
kernels and palm oil is expected to increase mainly in Indonesia
and Malaysia, and marginally in the other producing countries.
Moderate to slight increases are projected for groundnuts mainly due
to recovery of production in India.
With regard to oilseed products, the global output of oils is expected to be nearly half a million tons below last season's level. Prospects are for a fall in sunflowerseed, cottonseed and rapeseed oil, while production of soybean, palm and coconut oil is to expand. World output of oilmeals is expected to increase by almost 2 percent, mainly due to sustained soybean meal production.
The combination of sharply reduced carry-over stocks in all regions (except
for parts of Africa and Latin America) with only moderate increases in oilseed
production, points to a continued tightness of oilseed supplies in 1996/97.
Global consumption of oilseeds in 1996/97 is anticipated be close
to or fall slightly from last season's level, mainly reflecting reduced supplies.
The anticipated rise in soybean production, coupled with the decline in output
of high-oil-yielding seeds, is likely to increase the share of soybeans in
total oilseed crushings. Increased dependence on soybeans to cover world
demand for oils might contribute to a situation similar to 1994/95, which
would be reflected in higher soybean oil prices relative to those of soybean
meal.
Global consumption of protein cakes and meals, while continuing its
upward trend, will be affected by developments in feedgrain prices, which
could influence the overall profitability of compound feeding and/or trigger
substitution between various feedingstuffs. The demand outlook for cakes
and meals is uncertain at this time for the EC and the United States, where
high meal prices have slowed demand growth. In the major Far Eastern countries
(in particular China) the gap between domestic supplies and growing demand
for cakes and meals is expected to continue widening, thus possibly leading
to record net imports of soybean meal during 1996/97.
Commodity-wise, soybean meal will cover the largest part of the consumption
needs of cakes and meals in 1996/97, as a result of the foreseen rise in
production and relatively large supplies likely generated by the expected
crush-for-oil situation of this meal-rich oilseed. The additional supplies
of soybean meal will largely offset the possible reductions in the output
of rapeseed and sunflower cakes.
Although consumption growth in oils and fats is also expected to be conditioned
by relatively high prices, world demand for oils and fats is still expected
to rise, largely on account of further increases in demand in Asia. In the
main importing countries, domestic production of oils is likely to fall short
of consumption needs, and stocks in 1996/97 will have to be drawn down to
well below normal levels. The bulk of world import requirements of oils should
be met by palm oil from Indonesia and Malaysia.
China's import needs of oilseeds, fats and oils are expected to exceed their 1995/96 level, a result of the considerably lower oilseed crop expected next season, the reduction in stocks and the continued strong increase in domestic demand. Net import demand in all other major Asian importing countries is also expected to increase, largely because of a depletion of stocks and growing domestic utilization of oilseed-based products. In India, net import needs are anticipated to decline due to the prospective increase in domestic production of oilseeds and the accumulation of stocks of oilseeds and oils from the previous season. Import needs of oils, fats, cakes and meals (often covered by purchases of oilseeds for crushing) in the largest African and Latin American importing countries are likely to stagnate in 1996/97, mainly because of the unusually strong increases in domestic production.
The overall tightness of oilseed supplies expected for 1996/97, associated
with the anticipated decreases in world supplies of oils and fats, is likely
to lead to a further strengthening in prices of oilseeds and related products,
at least for the first half of the season. The anticipated expansion in the
import needs of China is expected to contribute to the firming of world market
prices of oilseeds, oils and meals. Prices of soybean, rapeseed and sunflower
should rise the fastest. At the same time, prices for annual oilcrops could
prove volatile and sensitive to weather risks in the next few months.
World prices of oils and fats are expected to remain above their long-term
averages due to supply tightness. Prices for lauric oils are also expected
to remain relatively high, although their premiums vis-à-vis
soft oils are likely to narrow as a result of anticipated increases in supplies
and export availabilities of the Philippines, Indonesia and Malaysia. Prices
for oilmeals are expected to remain high, given the overall tightness of
supplies, but declines in grain prices could be followed by more or less
pronounced declines in oilmeal prices as the share of grains in livestock
feeding would probably increase. As a result, the share of oils in the combined
product value of oils and meals, particularly of high-oil-yielding oilseeds,
is likely to increase during the next season.