COMMODITIES RESEARCH SUPPLEMENT

COMMODITIES RESEARCH SUPPLEMENT

SOYA BEAN

A heavily traded agricultural raw marerial, soy bean has featured dominantly in global commodity exchanges especially on Chicago Board of Trade (CBT) and London International Futures and Options Exchange (LIFFE). Demand for soy bean soared during current year (2018) in China just as unfavourable weather conditions impacted negatively on production of the commodity in South America.  Indeed soy bean  futures  accelerated during the year skyrocketing at 25 per cent.  Dramatic slump in United States end year stocks further stimulated sharp rise in price of the commodity.  Futures currently attain $10.84 per bushel.  Major soy bean exporters include Argentina, Brazil, United States, India, Paraguay, Bolivia and China (Source: LEGROUP, July 2013).  United States soy bean exports access  markets in North Asia consisting Japan, South Korea and Taiwan as well as South East Asia including Thailand, Malaysia and Philipines.

Export specifications are consistent  with US standard  No 2 as well as yellow beans.  Further considerations relating to commodity standard include moisture, weight, foreign matters, incidents of damage, grain defectiveness, aflatoxin content  as well as quantity of green seed.  Consignment must be free of toxic substances.  Soy bean is draught tolerant crop that grows within ecological environment of warm and humid weather.

Major importing countries in North and South East Asia process soy bean into meal for livestock feed and pet food. Bean processing also delivers oil, flour and powder.  Rich source of protein , these constituents attract high market demand.  Soy bean flour is utilised for baked food items in full fat or in fat free form.  Ascertained in health sectors for its reduced risk of coronary heart disease, the flour enjoys high consumer appeal especially in form of food additive and preparation of dough and confectioneries. Soy bean powder, gluten free and high in protein is formulated into soy milk and baby food.  Processing also produces soy bean oil, vegetable and cooking oils.  Furthermore oil paint formulation has been effective for printing ink. 

Currently soy bean trades CIF Rotterdam at $33.8 per metric ton while US yellow delivered $31.08 per metric ton (Source:ISTA Mieke GmbH- Oil World, US Department of Agriculture-World Bank).

Soy bean production in Nigeria

Nigeria Export Promotion Council (NEPC) affirmed that soy bean producing States in the country consist Benue, Jigawa, Kaduna, Kwara, Ondo and Plateau.  In a published monograph (2007), PrOpCom indicated that major producing States in Nigeria included Niger, Nassarawa, Kebbi, Taraba, Zamfara, FCT and Kaduna.  It was also affirmed that Benue is a major grower of the commodity while Oyo State produces substantial quantity of soy bean oil.  Field researchers established that over 500,000 metric tons of soy bean is currently produced in Nigeria. Outputs attracted about N130,000 per metric ton.  However market prices vary with proximity to producing areas with expectation of lower price ranges in Northern States while Lagos and Southern States would attract dramatic price increase.  It was also ascertained by  the PrOpCom group that soy bean supply chain created network of participants determined to reap profits from accelerating commodity demand.  Indeed widespread consumer base has emerged spread across Nigeria with market segmented to absorb the production of diverse soy bean food derivatives including soy oil, feed, meals, milk, flour and powder.  

Globally mini oil processing plants are available for production of vegetable sauces, yoghurt, soy milk and other derivatives.  Indeed it has become significant to propagate the use of processing machines at household level.  Consumption of derivatives of soy bean  stems malnutrion.  Rich source of protein, soy bean  is a cheaper alternative to animal protein, the price of which may  be unaffordable to poor rural dwellers.  While soy flour is preferred for bread and cakes, salad sauce could be readily sourced from soy paste.  Furthermore, the poultry industry benefits sustantially from use of soy bean meal, a product deployed as critical feed within lifestock sector in general.

Nutrients in soy bean; proteins, calcium, iron, magnesium and fiber all combine to reduce risk of cancer, abate cholesterol level and minimise incidents of coronary heart disease. Noteworthy, constituents of soy bean promote wellness while delivering healing remedies.  In terms of food for health assets, promotion of soy  bean as nutrient, additive and ingredient in routine diets for human and livestock seems imperative and strategic.  Indeed in Asian regions, as a result of value derived from its protein contents, soy milk features as the preferred substitute for diverse milk options.  Similar consumer preferences have been identified in numerous African countries.

Soy bean export

For export deliveries, soy beans are packaged in bags of  50 lb or 30kg wrapped and bulked in metric ton.  Transportation of the commodity occurs by road in trailer trucks, by rail and  ship.  Bulk cargo transportation is most prevalent.  Jute bags and other packaging materials could be deployed.  While resilient in terms of storage and shelf life, consumers express preference for delivery of commodity within the year of production.  At planting, seed varieties are certified along with specification for stipulated cultural practices.  The economic significance of soy bean in the global commodity market makes growing of the plant a strategic agricultural policy in producing countries.
Hammid Taju
Abuja, July 2018.