Hereafter we will analyze the oils and fats world market in order to evaluate the position of Argentina in production level as well as in exports. For that we have used the Oil World Statistics data of March 2017, who categorize “oils and fats” to the sum of different types of products. In the first place the ones of vegetal origin, who stem from the oilseeds crushing such as soybean oil, sunflower, rapeseed and others that belong from grains as it is the case of corn oil. In addition, the statistics sum the ones of vegetal origin as the oil obtained from the palm plant fruit ante the ones of animal origin as fish oil and sebum and fats in general.
On both tables 1 and 2 we could see the Oil World includes in the concepts of “ oils and fats” the following products: palm oil soybean, cotton, peanut, sunflower, rapeseed, sesame, corn, olive, palm kernel, coconut, butter, fats, fish oil, flaxseed, castor, sebum and fats.
In the table N°1, we can see the ranking of oils and fats country producers, where Argentina would be passing during the 2016/2017 campaign from the 7th place to the 6th position worldwide, overcoming Brazil that has been holding the 6th position in the last years. With an annual production expected in the campaign 2016/2017 of almost 10,231,000 tons, our country would be outpacing Brazil in almost 100,000 tn of oils and fats (Brazil would probably be around 10,127,000 tn in 16/17). While the different is quite exiguous, we must remember that in the cycle 2014/2015 –hardly two years ago - Brazil will produce a million ton more than Argentina and today our country has matched the production of our bordering countries y and slightly overcome it
The table shows something very interesting. If we compare the production per country during the last two years, Argentina integrates the lot of the three countries that has most see there productions of oils and fats in the world. The main growth corresponded to United States whose productions grew in two years almost 12.6%. Then comes India with an increase of 12%, raising the production in almost 1,000,000 tn in two years. Then comes Argentina with an increase of 10.5% in terms of this to campaigns.
In the table 2 we have exposed the main export countries of oils and fats. Argentina will remain in the current campaign 2016/2017 in the third place at international level, after Indonesia and Malaysia. These two countries are the main exporters of oils and fats of the world, which will register export sales abroad during the campaign that is closing of 27.8 million tons, respectively. Argentina, instead, would be placing in the 6.6 million tons of export tons. Take into account that Indonesia and Malaysia show excellent numbers because they are the main producers and exporters of palm oil. Normally more than the 90% of the exports of oils and fats of Indonesia and Malaysia are dispatched of palm oil.
As we all know the Argentinian exports of oils and fats depend mainly of soybean oil and, in a very lesser extent of sunflower oil. We can observe this in table 3 where the compositions of the productions and exports of oils and fats of our country is estimated for de current campaign 2016/2017 with combined estimates of our entity and Oil World.
As regards the productions of oils and fats, in the current campaign we expect that Argentina reach the 10.2 million tons composed by 8.5 million tons of soybean oil and 1.3 million tons of sunflower oil. Other oils and fats will sum 409.000 tons. From this 10.2 million tons, would be exported this year almost 6.6 tons of oils and facts composed by 5,800.00 of soybean oils, 500.000 of sunflower oil and 283 million tons of other products.
Argentina would be selling abroad almost 70% of the productions of soybean oil, while the remained 30% would stay in the domestic market to supply -mainly – the biodiesel industry (automotive industry) and then and after other demands derived from the domestic consumption. As regards the sunflower oil exports, our country will sell this year almost 40% of the production abroad, leaving 51% in the domestic market, mainly for edible use.
The improvement sustained in the argentine position in the global marked of fats and oils will comply mainly to four factors:
a) Argentina has prepared its industry in order to increase their production levels. The investment rise in mills during the last years has made that our industry national oilseed complex has currently 48 factories (all actives) with a theorist capacity of soy and sunflower crushing of 202,831 tons/day. Inside the expanded Mercosur, Argentina is the most important country as regards the matter of installed processing capacity in the Oilseed Industry. We have to take into account that the crushing capacity of oilseed seed of Argentina 10 years (in the second semester of 2003) in 97.546 Tn/dat. It has doubled in less than 15 years. With a crushing capacity that Argentina currently has it could crushed almost 67 million tons of soybean and sunflower every year. This means that the proper merchancy of our country is not enough to feed this “oilseed giant”. This year Argentina could produce 58 million tons of soybean and 3.5 million tons of sunflower. It need that contribution of the temporary imports of soybean from Paraguay that reappear in 2016, as we explain below.
b) The increasement in the production of sunflower for this cycle. In the campaign 2016/2017, the Ministry of agriculture estimates that Argentina could obtain a sunflower crop of 3,500.000 tn, while in the previous cycle the production would have been of 6 million tons. This additional 500 mil tonnes, consolidates a bigger production of sunflower oil.
c) The relative stability in the national soybean production. During the three campaigns, in spite all the weather problems, Argentina did not diminished its crop below the 58 million tons according to MINAGRI. In the campaign 2015/2016 was of 58.8 million tons and in the current could be of 58 million according the Ministry. Our estimates are giving something less: 57 million. Anyway, it seems to consolidate a floor over the 55 millions that enables the oilseed industry to count with a good quantity of merchancy for crushing, except weather events even in the worst events, even worst that to the registered in the last to cycles. The different genetic varieties used in Argentine in the last years could be playing an important role, the ones which prioritize the yield without looking the bean protein.
This situation of increasement in the production and exports os oils and fats could consolidate in the future with the new ivestment ine oil plants that are taking place in RENOVA.