1. “Until lions have their historians,
tales of the hunt shall always glorify the hunter”
Soybeans and Soy Oil
Global Supply demand situation and Role of India
A PRESENTATION BY
McDonald Pelz Global Commodities

2. Life of a Soybean Trader Fragile- In search of answers

3. We are going to cover …. In next 30 mins
Source: Economist
India demand is function of availability of domestic supply not the consumption potential
Population pressure is increasing- demand elasticity is very high
Map not true representation of Indian Geo Borders- Just rep

4. 23.07 million passengers were on the move on any given day- ????????
India on the move…
On any given day-
12617 trains were running on Indian Railway tracks.
The total number of passengers carried in was billion
23.07 million passengers were on the move on any given day- ????????

5. Direction of Global Population
Consuming Countries population possibly will increased steadily
Producing Countries will see stagnate population
Welcome to Asian and African Markets
Indian population will overtake china around 2025 and will only slow down growing in 2045 ( in normal situation)
Population in Million

6. Important balancing Role in Global Supply Demand Economics
Global Supply Hedge…
El- Nino Effect on Global Crop Production
India was the biggest exporter of grains, oilseeds and meal in the Asian region
Important role in global supplies -la nina
India stayed food self sufficient
2 years of Bad Monsoon 2014, 2015 lead India to exhaustion of Indian stocks
It is important to watch – monsoon of It will be the most important event of commodity traders
Source: FAO Paper
Important balancing Role in Global Supply Demand Economics

7. Let us start with a story…..

8. China and India (Soybean Vs Veg Oil Import Index)
‘000mt, Source: USDA
India Vegetable Oil imports have risen at a faster pace than soybean import into China

9. World Soybean Production
Myn mt, Source: USDA
World Soybean Production is concentrated in Americas

10. US, Brazil Dominates exports and China Imports
World Soybean Exports
Myn mt, Source: USDA
US, Brazil Dominates exports and China Imports

11. Soybean Production and estimates
Myn mt, Data Source: USDA
Global Supply, Demand and Trade is increasing
China dominates Global Trade with around 65% of global trade
India is fifth/sixth among list of producer of soybeans

12. World Oilseed and Soybeans
Mt/Hectare Source: USDA
Share of Soybean in Global Production is going up

13. World Soybean Yield Growth Rate
Source – Credit in Picture
Technology- GMO driving Growth, we are concerned about farmers

14. World Soybean Yield Growth
Source – Credit in Picture
Technology- GMO driving Growth, we are concerned about farmers

15. World Yield and Indian Yield
Mt/Hectare Source: Hightower
Indian Share of global soybean yield falling
Globally yield is driven by technology – in India by hope
We cannot double farm incomes be competitive globally without giving our farmers tools to compete
Mt/Hectare Source: USDA

16. Highly Monsoon sensitive Areas
Monsoon- Hope and Technology
Soybean Areas
Mustard Areas
Soyabean
Mustard
Highly Monsoon sensitive Areas

17. India Role in Global Veg Oil Market
‘000mt, Source: USDA
Hunger games by Manmohan kids– globalization lead to demand spurt, increase in Veg Oil Imports
Stagnant Production- Increasing Demand= Imports

18. Soybean Oil Domestic Supply potential is limited
Global prices favourable, as impacted by lanina- India is dominant Player
Soybean Oil Domestic Consumption Imports Production
World
India
USA
China

19. Sunflower Oil Domestic Supply potential is limited
Black sea supplies are increasing- potential for India to increase its potential
Sunflower Seed Oil Domestic Consumption Imports Production
World
India
USA
China

20. India Oil Basket Ending Stocks around 10pct
Source – USDA
Ending Stocks around 10pct
Domestic Production which is around 30% of consumption- change in domestic production impacts stock status
Domestic share in total oil demand going down due to stagnant production

21. Comparative Numbers
China domestic production is keeping pace due to soybean oil production from imported bean to tune of 95 myn mt
Domestic soybean production in China is stagnant
India domestic production is stagnant with limited hope of revival or increase
It is highly inefficient to produce oilseeds in India due to policy constraints
Demand should continuously grow for imported veg oil- but world is finding alternate usage in fuel

22. SE SA Total Demand Supply- Meal
Source: USDA, McDonald Pelz Analysis
SE + SA demand is increasing for oilseed and Meal
Indian supplies are now falling short to meet regional demand

23. % Growth of meat products
Source: USDA, McDonald Pelz Analysis
SA + SE is fastest growing meat market in the region…
It means more oilseed and feed grain demand

24. SEA in Graph- Meal demand
Source: USDA, McDonald Pelz Analysis
SE demand is increasing for oilseed and Meal
Indian supplies are now falling short to meet regional demand

25. India numbers in Graph- Meal
Source: USDA, McDonald Pelz Analysis
Tightening Supplies making region more dependent on global supplies

26. It is not only about SND…..

27. Soybean and Soybean Oil
Veg Oil Prices move in same direction as soybean CBOT

28. Correlation in Soybean and Oil Prices
Crude Price and Soybean has high degree of correlation

29. Sunflower Oil and Soybeans
Driver for Sunflower Prices is soybean CBOT- US bean production

30. Soybean Oil and Palm Oil Prices
Who drives what….

31. Spreads is the name of the game…

32. In the Nut shell….. Snd is Driver

33. Global Production - Soybeans
Not adding carry out- Price volatility will go up

34. Global Oilseed Production
Major Oilseeds includes Copra, Cottonseed, Palm Kernel, Peanut, Rapeseed, Soybeans and Sunflower seeds.

35. Crush expansion on back of increased meal demand in SE Asia
World Soybean Crush
Crush expansion on back of increased meal demand in SE Asia

36. Reducing Share… China expanding We are helping Argentina Farmers
India Soybean Crush
Reducing Share… China expanding
We are helping Argentina Farmers

37. Brazil Key to watch
Argentina excess wet condition compared to last year.
Brazil soybean plantings are just getting started and most of the Brazil growing areas are dry. Soybean planting delayed this year in South America.
India received 5% lower rainfall than normal in the monsoon season, nearly half of the country's farmland lacks irrigation.
USA in July’17, 14% of soybean acreage were under drought conditions. Overall, 60% of the soybean crop was reported in good to excellent condition, 14% points below the same time last year.

38. Crush Margin in China is finally positive
Important Criterions
Crush Margin in China is finally positive

39. WE PROVIDE INSIGHTS- Beyond Data and Information to our Customers
SoAM
Black Sea
Asia- Producer and Consumer of
grains and Oilseed- we are here to cater your requirements
China Demand
Wheat Market

40. Worldwide McDonald Pelz
India Office
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Sector-53, Gurgaon India
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