U.S. Soybean Market: Top 5 Countries Market Share You Need to Know

Soybean is an edible seed that belongs to the legume pea family and originated in China centuries ago. It is considered as an important source of proteins for millions of vegetarians. Initially, soybean gained popularity in China, Japan, and other Asian countries and entered the U.S. in 1804, where it got recognition majorly in South and Midwest countries.

Soybean has gained popularity in the U.S., as the cheapest and richest source of protein for vegetarians and vegans. It has also garnered attention among animal feed manufacturers due to numerous health benefits. Soybean is not always consumed directly. Most Americans consume soy-based ingredients such as soy milk, tofu, soy sticks, sauce, and others. According to recent trends, the most common cooking oil used in the U.S. is derived from soybean and is used in cooking a wide range of products. The U.S. alone produces approximately one-third of total soybean produced across the world followed by Brazil and Argentina.

Soybean can be cultivated in several types of soil but thrives in a warm climate. Soybean has a unique production cycle of growing, planting, and harvesting across the world. Due to various production cycles, the prices also vary from one region to another. It is harvested after the leaves have fallen off and moisture is reduced. It has been observed that in the U.S., the majority of soybean crops are genetically modified and are resistant to the herbicide glyphosate.  In the U.S., most soybean crops are grown in the Midwest and Delta regions. Typically, the southernmost areas begin planting first, and the northern areas begin planting as the snow melts, the soil thaws, and temperatures warm.

Soybean Market
Source: The balance.com

Despite being grown in various parts of the world, the U.S. is the most influential producer of soybean and plays a large role in governing the price of the crop along with numerous other factors. According to the U.S. Department of Agriculture, the U.S. produced around 320 million metric tons of soybean in 2018. Soy protein has been used as an important ingredient in various food products such as bread, soup, ready-to-eat meals, and others. Despite its extensive use, the total amount of soy protein consumed by Americans is far less than commonly believed. In the U.S., the daily per capita of soy protein intake is estimated to be less than 2 grams per day, which is a very small percentage of total protein intake among Americans. Total protein consumption among men and women in the U.S. is approximately 80 and 65 grams per day, respectively.

Despite being highly nutritious, soy protein has received huge attention in the U.S. due to its functional purpose, such as moisture retention. In the vast majority of cases, the soy protein added to foods makes a negligible contribution to the nutritional value of the product as it is present in such small amounts. However, one cup of soymilk made from whole soybeans contains about 25 mg isoflavones, which is highly nutritious.

Furthermore, various soy-based products are found in the American food chain, which includes soy lecithin (an emulsifier), soy sauce, and hydrolyzed soy protein or hydrolyzed vegetable protein (HVP).  HVP, which is used as a flavoring agent or as a taste enhancer, is also produced from maize gluten or wheat gluten. Soybeans play a huge role in the U.S. food supply although the amount of soy protein and isoflavones consumed by most Americans is limited. However, soybeans can be stored for a long time but it deteriorates and loses its nutritional value over a period of time.

According to the United Soybean Board and Qualified State Soybean Boards, soybean is one of the important agricultural commodity exported from the U.S. Around 60% of soybeans produced in the U.S. is exported to other countries. Increasing health concerns across the world is also expected to witness an upward trend. There are high chances that it can surpass the production of corn. The U.S. Soybean Export Council (USSEC) is educating and promoting the usage of soybean in feed, aquaculture, and human consumption due to its various benefits.

The American Soybean Association’s (ASA’s) World Initiative for Soy in Human Health (WISHH) complements the work of the USSEC by exploring smaller and immature markets to promote the import of U.S. soy for human and animal diets in the developing countries.

Soybean Market In USIn 2018, the U.S. soybean market witnessed its lowest price in more than nine years following renewed concerns about a U.S.-China trade war. More than half of the U.S. soybeans go to China, the world’s largest consumer of the beans. The U.S. has several complaints against China on intellectual property, forced technology transfers, and industrial subsidies. The U.S. farmers stored their soybeans after the fall harvest, instead of selling them to grain traders and processors, because of low prices and lack of alternative buyers.

However, in December 2018, China made its first major purchases of the U.S. soybeans since President Donald Trump and his Chinese counterpart Xi Jinping struck a trade war truce. This deal gave some relief to the U.S. farmers who have struggled to find buyers for their record-large harvest. The purchases provided a goodwill gesture before the next round of U.S.-China talks to change their terms of trade. The soybean exports also provided relief to the U.S. farmers. Soybeans are the single most valuable U.S. agricultural export product and China bought 60 percent of those exports in 2017, worth $12.25 billion. In order to save the market from downfall, the U.S. government either needs to focus on its relationship with China or needs to find new opportunities in other countries. It will be interesting to see, how the relationship between the U.S. and China affects the fate of the soybean market.

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Sources: 1. cnbc.com  2. thebalance.com 3. thesoynutritioninstitute.com 4. reuters.com