A (JRC) study published by (ReNAPRI) 2018
Global soybean area has increased rapidly in recent decades, with global area doubling over the last 20 years. Expansion has been driven by a growing population that has increased demand for vegetable oil for food and biofuels, and soybean meal as feed for meat production. That expansion globally is expected to continue with increasing demand and the development of new varieties and farming techniques that develop new areas where the crop can be grown.
In Eastern and Southern Africa soybean industry is expanding. Although population growth
globally is slowing, populations in that region are growing rapidly and will be a major driver of
the economy in these countries. This means that domestic demand for vegetable oil and soybean
meal for feed are going to grow rapidly. Soybeans are attractive for these countries as they
provide an alternative for producers and raise rural incomes. It can provide an input into a value
added activity (crushing), improve soils and have nutritional benefits. Key specificities to take
into account are listed below.
- The area of soybean has grown in each of the four countries studied in this report (South
Africa, Zambia, Malawi and Mozambique) over the past decade.
- The nature of the industry is different in each of the countries, varying from a mostly
commercial sector in South Africa to mostly smallholder farmers in Malawi.
- The expanding livestock sector is a driving force for the industry, through the demand for
feed. This demand is growing throughout the region, reinforcing trade opportunities.
- Populations are growing rapidly in the region. In the model this leads to increased demand
for soybean oil, and meal for feed. However, the increasing population change is likely to
have other wider effects on the economy that could influence the sector.
- Exchange rates for the countries have shown a high degree of volatility in recent years and
this will continue to impact the sector which is closely linked to world markets and where
intra-regional trade is going to play an important role.
- Recent droughts in the regions have hampered the development of the sector, but are
expected to recover in the coming years. This does, however, highlight the importance of
climate for the evolution of the sector.
- The countries are generally net importers of oil. As soybean crushing in the countries
expands, this reliance on imported vegetable oil will likely be reduced.
- Agricultural support policies do not present significant role in the soybean sector, and is
mostly focused on maize, given its importance as staple crop.
It is expected that despite a continuation of relatively low global oilseed prices, the soybean sectors in each of the countries will continue to expand, and trade in soybeans and their products will increase across the region. The expansion will depend in part on the policy pursued in the countries, in particular with respect to the livestock industries. Policy reforms in major world soybean actors, for instance change in biofuel policy or rise in protectionism, could also impact the Eastern and Southern Africa soybean industry. Looking the 2026/2027 horizon, this medium-term outlook remains subject to many uncertainties on upcoming market development,
macroeconomics or policy changes.
This report provides a foundation for future development which would ideally include an examination of regional trade in soybean meal including countries not modelled here, collection of better data, and the modelling of other sectors that impact the industry especially livestock.