Should US Soybean Growers Turn Their Gaze Towards Africa? Unlocking the Potential of African Soy Import Demand
Introduction
The Soybean Innovation Lab (SIL) invites readers to explore the untapped potential of Sub-Saharan Africa (SSA) as a lucrative market for US soybean growers. Over the next three weeks, SIL and farmdoc will present a series of articles delving into Africa's role as a promising export destination for US soybeans. The African market presents a complex landscape, offering both opportunities and challenges. While it boasts a large, diverse, and rapidly growing economy, it also grapples with significant uncertainties, substantial business risks, and a nascent demand for soybean and associated products.
This initial article focuses on the dominant food and oil trends shaping the African continent, drawing insights from a previous farmdoc daily report (November 13, 2025). The subsequent articles will delve into the import flows of soybeans, oil, and meal into Africa, followed by case studies of four African countries: Egypt, Ghana, Nigeria, and Tanzania. These studies will examine their soy and soy product imports, logistics infrastructure, and policies governing genetically modified soybean imports. The final article will also include a comprehensive literature review on soy trade and Africa.
Soy Import Demand in SSA
Is SSA's soy import demand substantial or even promising? The answer is affirmative. Soy product demand in SSA holds immense potential. By employing the soybean equivalent import metric, Africa imported an average of 2.1 billion bushels of soybean equivalents annually during the 2010-2022 period. This equates to the production of approximately 40 million acres, which is a staggering 47% of US soybean plantings (Figure 1). The lion's share of this demand (64%) stems from palm oil imports, while soybean oil, meal, and grain imports account for 21%, 8%, and 7%, respectively.
The African soybean grain import equivalent metric is calculated by summing up four components: 1) soybean imports, 2) soybean oil imports, 3) soybean meal imports, and 4) palm oil imports, all adjusted to soybean grain equivalents. This metric theoretically captures the grain demand that Africa's processors and manufacturers would theoretically require if all imports were in the form of grain. It seamlessly integrates current import activity with the potential to expand soybean export demand by challenging palm oil's dominance. When measured in bushels and acres, this equivalent metric facilitates comparisons with US production.
Between 2010 and 2022, these imports exhibited a compound annual growth rate (CAGR) of 3.82%. Soybean grain imports led the pack with a CAGR of 8.04%, while palm oil, soybean oil, and soybean meal imports grew at 4.46%, 2.05%, and -0.34%, respectively.
African soybean production currently stands at 270 million bushels, accounting for approximately 6% of US production and 2% of global production (Figure 2). Over the past decade, global soybean output has grown at a CAGR of 2%, while African production has surged at an annual rate of 11%. Despite this rapid growth, Africa remains far from achieving self-sufficiency and will continue to rely heavily on imports. For instance, projections to 2050 indicate that Africa would still meet only 35% of its current soybean equivalent import demand, even if the current production growth rate is maintained.
In the 1960s, African soybean processors had limited use for soybeans, processing less than 20% of the region's soybean crop to produce food oil (Figure 3). Over time, processors have expanded their capacity, and by 2002, the industry shifted from undercapacity to overcapacity. Local supplies could no longer meet demand, leading to a significant surge in soybean grain imports. More recently, processors operate at 40-60% overcapacity, and they import approximately 200 million bushels of soybeans to maintain operations. The demand for soybean grain imports has been on an upward trajectory since 2010, with a CAGR of just over 8%.
Note: The Soybean Innovation Lab (SIL) at the University of Illinois is a global leader in establishing soybeans as the standard feed, oil, industrial materials, and biofuels in Sub-Saharan Africa (SSA). SIL's extensive network across 31 countries, coupled with its experienced team, proven track record, and on-the-ground partners, positions it as a valuable resource for clients seeking to tap into the fastest-growing and potentially vast new soy market.
