China to become net exporter of soybean oil for second year in a row

According to a report from the U.S. Department of Agriculture’s Foreign Agricultural Information Service (USDA FAS), China is expected to maintain its status as a net exporter of soybean oil for the second year in a row, selling more product to foreign markets than it imports. This is due to record export volumes to India.

Much of this record export volume was supplied as crude soybean oil due to Indian tariffs on refined soybean oil. Significant volumes of refined soybean oil were also exported to South Korea.

However, the report notes, a more notable change was the overall decline in soybean oil imports for the world’s largest consumer of vegetable oils.

As recently as 2012/13, China was the world’s largest importer of soybean oil, driven by rising incomes and the country’s rapid economic development. It has since become the world’s leading soybean oil producer, thanks to significant investments in processing capacity to meet growing demand for protein meal and vegetable oil. Going forward, oil consumption in China is expected to grow at a slower pace, with the slight increase in consumption driven by a significant increase in processing volumes.

According to the service, factors contributing to the decline in demand include declining consumer demand and demographic trends such as an aging and declining population.

“This development leads to domestic soybean oil production exceeding demand, fueling export growth,” the report states.

Tags: China, export, soybean oil