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Help! I Need Soybeans!

Cells of a Raw Soybean

The world will grow another 350 million tonnes of soybeans again this year. Soybeans are the largest source of vegetable protein on the planet, but supply can still run out, especially in parts of Africa where soybean cultivation is only just beginning.

The world’s major soybean growing areas are North and South America. Europe and China are the single largest markets, but over the last 20 years, an increasing number of ‘smaller’ buyers have emerged, in Africa, Middle East and Asia. It’s not surprising, because the quality of soybean protein – measured by its amino acid profile – is outstanding.

So from time to time, customers call us to ask for help in sourcing soybeans. There are 2 questions to ask :

1st Question: What volume do you want to purchase, and what is your purchasing timetable? Are you planning for a long-term supply arrangement, or is this a stop-gap measure until your local harvest comes in?

2nd Question: Are you sure there are no local or regional supplies? For example, in West Africa, nobody really knows how many soybeans are produced each year. In the case of Ghana, neighboring countries – Togo, Côte d’Ivoire, Burkina, Benin, Nigeria & Cameroon – all grow soybeans. Regional sourcing will be your best option if local supplies are gone.

The aim should always be to source locally if possible: the benefits include lower transport costs, payment in local currency, and as a processor you want to be supporting your local farmers. So start by looking to source locally, then regionally.

The next option is to import soybeans in containers. Soybeans are loaded bulk into containers, but nevertheless a 40’ container only holds 26mt if moving on the rail network, or 28-30mt if loaded at port; 20’ holds 24mt. We can help you get a quote from a container shipper.  But freight cost per ton can be high depending on where you are.

The standard option for moving soybeans is bulk shipment on a vessel. Freight varies with distance, destination and size of the shipment. For example, bulk freight from USA to northern Europe is presently around $16, whereas USA to North Africa is around $30. Larger customers processing 500 tonnes per day, for example, will typically purchase a vessel of 15,000 mt per month, which means $5 million per month expenditure on raw material.

The higher the volume, the lower the freight cost. The common industry-standard Handysize bulk carrier is now about 32,000 mt dead weight, with a draft of about 10 metres and has 5 cargo holds. These vessels are widely used for regional shipments to ports with limited unloading facilities. The minimum bulk parcel on a vessel is usually 5,000mt, which nonetheless implies some serious storage and financing issues.

So we always recommend the small processor needing 500-600 mt soybeans per month to aggressively pursue local sourcing.  If that is simply not possible, we are happy to help you get a quote on containers of soybeans.  Just give us a call.

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