Egypt: Growing Markets
By Jill Parrent | ISA Communications Coordinator
Exporting soybeans is vital to Illinois farmers as over 60% of soybeans grown in Illinois are exported overseas. The Illinois Soybean Association is committed to discovering new markets worldwide to assist farmers in selling their harvested soybeans. In recent years, Egypt has become one of the fastest growing markets for soybean exports.
In the last five years, Egypt wants and needs for protein and consumption of soy has skyrocketed, confirming the growth of soy requests. As U.S. grown soybeans are especially high in protein because of soil quality and farming methods, they have quickly become the preference. Eric Woodie, Illinois Soybean Association’s Trade Facilitator and Analyst, emphasizes, “This increase in demand is in part because Egypt has expanded their ability to crush beans and utilize beans and oil.” This rise demonstrates the necessity of knowing the market and the potential for where soybeans could go. “You would be hard pressed to find another country that has had this growth over a short period of time,” Woodie states. In the past three to five years, soybean imports into Egypt have increased twofold.
There is a desire for protein needs in Egypt and U.S. soy is the perfect match. Protein consumption has heightened as the population is looking to additional food source options, health benefits, and overall economic needs. While there is also an enhanced desire for corn and other meal products, soy has steadily maintained its demand.
Similar to the U.S., soybean meal in Egypt is used primarily for animal and human consumption. Cooking with soybean oil has increased significantly, expanding the need for more soy imports. With an increased efficiency comes increased demand, an outstanding advantage for farmers. In the 2019 and 2020 marketing years, Egypt imported a record number of U.S. soybeans; 4.56 million tons, which accounts for 85% of Egypt’s overall soybean imports. Refinitiv trade flow models project that Egypt’s soybean imports during the first five months of the 2020 and 2021 marketing year are expected to reach about 1.88 million tons, a 12% increase from the same period last year and 58% above the three-year average of 1.19 million tons.
It is a great benefit for the U.S. becoming one of the first major connections Egypt has come to trust. With the U.S. being the largest importer to the country, they have become comfortable with focusing on utilizing U.S. soy versus other countries. The value of Illinois soybeans is reliable as we consistency meet the buyers in logical and practical ways. Egypt continues to be a return customer for the U.S., and we will continue to strengthen the relationship.
In the future, maintaining this exciting growth is anticipated as Egypt will likely import more soybeans again this year, more than the previous year. Crushing capacity in the region is increasing, therefore creating a larger demand for soy.
As a farmer, it is important to learn and understand newer markets and discover ways to match competitive logistics. With a growing aquaculture and poultry market and increased crushing capacity at the local level, demand for U.S. soy exports to Egypt will continue to grow, increasing the price Illinois farmers receive for their soybeans. Woodie concludes, “We want more soy going overseas to create fresh markets. New markets are all unique, and we have to work to understand them to create a working relationship.”