Growing Pains: Soybean Meal Demand Key to U.S. Crush Industry’s Outlook as Capacity Grows

December 2018 -

Soybean Meal Demand Key to U.S. Crush Industry’s Outlook as Capacity Grows

Key Points

  • The historically strong crush margins that soybean processors have enjoyed in recent years have driven the industry into the biggest expansion phase in 20 years.

    Soybean Crush Margin
  • Two new soybean processing plants are expected to start production in the U.S. by the end of 2019 with a third expected to begin operation by the end of 2021.
  • These new facilities will support local soybean basis to the benefit of farmers, but may pressure local grain elevators competing for soybeans at harvest.
  • Soybean meal consumers may struggle to keep pace with the new production for 4 years, pressuring crush margins, but soybean oil consumers could use around 75 percent of it in the first year.
  • Increasing exports for U.S. soybean meal will be necessary to alleviate the industry’s growing pains of soybean meal oversupply in the years ahead.

Read the Report