Lasenor is actively present in the main sourcing areas for NON GMO lecithin. We will offer regular feedback on its development as a diagnosing tool.
Non GMO Soya – Identity Preserved
Indian Soy Crop 2021 estimated production figures
Highlights of this issue : · Monsoon season is still in full swing, with late showers. Beans humidity is a factor to be carefully monitored as this may bring quality issues (OTA levels).
Import figures show a fast-growing demand in India, strongly supported by a healthy local Feed industry.
Increasing sea freight from South America to India combined with restricted lecithin availability in Brazil have led to bullying price levels.
As a consequence, many Indian companies have been forced to accept paying prices similar to European market to get the material they need.
Indian Soyabean prices have reached a record price of EUR 1200/Mt this year 2021, (and we now see) farmers seem reluctant to sell at a lower price level despite oil complex slight decrease overseas.
From the demand point of view, we have been seeing a kind of panic in Europe and South America, due to scarce Brazilian production of Non GMO IP material:
Many customers found themselves short, with open positions and default from their usual suppliers.
This puts additional pressure on Indian supply, and we expect prices remaining high until the new crop in South America.
Last but not least, sea freight from India to Europe/Americas has sky rocketed in the past five months, which makes many sellers reluctant to make long term agreements.
Facing such an uncertain scenario, Non GMO IP Russian material is now strongly considered as a back-up option.
– Latest harvest figures in the Black Sea show that crop may turn potential record crop in Ukraine (larger than
previously assumed), but on the other hand Russian crop may turn a lower than expected.
In the worst-case scenario Russian production may turn out below 15 million Tons in 2021.
– Abundant production is expected in several EU countries.
– However, the transition to the new crop is being extremely difficult for various factors:
- The season started later than expected due to weather conditions
- Many deliveries are pending due to the shortage
- Many farmers keep stock, being reserved sellers
- Russian taxation on exports is reducing processing of sunflower seeds
- Demand is healthy in EU 27, with biodiesel production switching from rapeseed to sunflower.
– As a result, demand of raw materials remains firm and the expected price decline on sunflower lecithin on the high season has not materialized.
– From a more global point of view, the Non GMO production deficit in South America, combined with sea freight crisis, has a strong impact on sunflower lecithin market segment.
India will not be able to absorb 100% additional demand coming from usual Brazilian customers. We strongly believe that end users will continue with the switch from IP soy to sunflower in order to guarantee the Non GMO status.
In our views, both Non GMO soya lecithin and sunflower lecithin prices will remain at high price level, well above EUR 2,00/kg EXW, with additional potential increases later in the year if demand remains strong.
Next crop in South America will have to be carefully followed, as there is a high risk that La Niña weather conditions would result in rainfall deficit and bad crop.
All these factors are at play in a market where we continue seeing a solid demand for lecithin as a “natural” emulsifier