Taiwan Standards Beneficial to US West Coast Soybeans
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Taiwan’s MY2021/2022 imports of non-GE Soybeans were 86,699 MT, an increase of 11 percent YoY. In MY2021/2022, Canada took 58 percent (50,469 MT) of the non-GE soy market share, followed by the United States at 37 percent (31,912 MT). The United States has recovered market share from Canada due to competitive pricing and improved logistics. Non-GE exports are heavily dependent on containerized shipments.
Since November 2014, Taiwan has required that GE and non-GE Soybean shipments enter under different HS codes. In May 2019, Taiwan further divided the codes for “other” or feed use. Soybeans are still imported mostly under “other” use, which has the flexibility to go into food or feed. In MY2021/2022, 7,065 MT of U.S. imports were filed under the GE feed code (same as the previous MY). FAS Taipei expects most imports to continue to be under the “Other” use category because it retains end-use flexibility.
Black Soybean is widely used in Taiwan for food processing and manufacturing for its health benefit and consumer preference. It is the only category of Soybean for which imports from China are permitted. China has remained the biggest supplier, while the United States and Canada are a distant second and third. Taiwan has limited local production of black Soybean (included in the Soybean production statistics), mostly grown under contract. Domestic black Soybean production expansion faces the same challenges as regular Soybean. In MY2021/2022, 8,511 MT of black Soybean was imported, of which 7,095 MT (83 percent) came from China. As per AgFlow data, Brazil exported 0.5 million tons of Soybeans to Taiwan in Jan-May 2023, followed by the US with 0.3 million tons.
MY2023/2024 ending stocks are forecast at 167,000 MT due to import restocking. MY2022/23 ending stocks are estimated to increase to 186,000 MT. Buyers remain conservative in the current high-uncertainty environment (including, among other factors, the Russia-Ukraine conflict) and will purchase when needed. With limited commercial storage options in Taiwan and the frequent but delayed containerized shipments supplementing demand, crushers do not typically keep excess stock levels. MY2021/2022 ending stocks were 135,000 MT as domestic consumption drew down inventory.
Soybean Meal in Taiwan
MY2023/2024 Soybean Meal production from crushing is forecast to recover to 1.63 MMT. MY2022/23 Soybean Meal production is estimated to decline to 1.6 MMT due to a weakness in feed demand. Taiwan’s annual Soybean crush has recently fluctuated around 2.0 to 2.1 MMT. Crushers will optimize their crushing pace to balance their Soybean Meal and oil stock levels. Crushing operations have consolidated with two large plants (Central Union & TTET) and two smaller crushing plants (Everlight & Tai-Sugar).
Daily combined crushing capacity is 9,000 MT with an annual total capacity of 3 MMT. The average capacity utilization rate is around 65 percent. According to MOEA’s statistics, MY 2021/2022 crush volume increased slightly, by 25,000 MT, over the previous MY. Taiwan crushers have developed an export trade flow for Soybean Meal in recent years, which can serve as an alternative outlet when stock begins to build up. Thus, MY 2022/2023 crush will likely be sustained despite the short-term weakness in feed demand.
In October 2021, Taiwan modified its Soybean Meal standard with two grades for Soybean Meal (44%; 42%) and dehulled Soybean Meal (48%; 46%) on protein levels. Multiple factors, including climate change and breeding, have decreased soy protein levels in recent years. As a result, Soybean Meal sometimes has had difficulty meeting Taiwan’s previous standard for the protein of 43 percent for Soybean Meal and 48 percent for dehulled Soybean Meal. In theory, this would benefit U.S. west coast Soybeans as their protein levels are usually lower than either U.S. east coast or Brazilian Soybeans.
Other sources: USDA
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