Until lions have their historians tales of the

“Until lions have their historians, tales of the hunt shall always glorify the hunter” Soybeans and Soy Oil Global Supply demand situation and Role of India A PRESENTATION BY Mc. Donald Pelz Global Commodities

Life of a Soybean Trader Fragile- In search of answers 2

We are going to cover …. In next 30 mins Source: Economist • India demand is function of availability of domestic supply not the consumption potential • Population pressure is increasing- demand elasticity is very high Map not true representation of Indian Geo Borders- Just rep 3

India on the move… On any given day 12617 trains were running on Indian Railway tracks. The total number of passengers carried in 2012 -13 was 8. 421 billion 23. 07 million passengers were on the move on any given day- ? ? ? ? 4

Direction of Global Population Consuming Countries population possibly will increased steadily Producing Countries will see stagnate population Welcome to Asian and African Markets Population in Million Indian population will overtake china around 2025 and will only slow down growing in 2045 ( in normal situation) 5

Global Supply Hedge… El- Nino Effect on Global Crop Production India was the biggest exporter of grains, oilseeds and meal in the Asian region Important role in global supplies -la nina India stayed food self sufficient. 2008 -15 2 years of Bad Monsoon 2014, 2015 lead India to exhaustion of Indian stocks It is important to watch – monsoon of 2017 - It will be the most important event of commodity traders Source: FAO Paper Important balancing Role in Global Supply Demand Economics 6

Let us start with a story…. .

China and India (Soybean Vs Veg Oil Import Index) ‘ 000 mt, Source: USDA India Vegetable Oil imports have risen at a faster pace than soybean import into China 8

World Soybean Production Myn mt, Source: USDA World Soybean Production is concentrated in Americas 9

World Soybean Exports Myn mt, Source: USDA US, Brazil Dominates exports and China Imports 10

Soybean Production and estimates Myn mt, Data Source: USDA Global Supply, Demand Trade is increasing China dominates Global Trade with around 65% of global trade India is fifth/sixth among list of producer of soybeans 11

World Oilseed and Soybeans Mt/Hectare Source: USDA Share of Soybean in Global Production is going up 12

World Soybean Yield Growth Rate Source – Credit in Picture Technology- GMO driving Growth, we are concerned about farmers 13

World Soybean Yield Growth Source – Credit in Picture Technology- GMO driving Growth, we are concerned about farmers 14

World Yield and Indian Yield Mt/Hectare Source: Hightower Indian Share of global soybean yield falling Globally yield is driven by technology – in India by hope We cannot double farm incomes be competitive globally without giving our farmers tools to compete Mt/Hectare Source: USDA 15

Monsoon- Hope and Technology Soybean Areas Mustard ea Soyab n Highly Monsoon sensitive Areas

India Role in Global Veg Oil Market ‘ 000 mt, Source: USDA Hunger games by Manmohan kids– globalization lead to demand spurt, increase in Veg Oil Imports Stagnant Production- Increasing Demand= Imports 17

Soybean Oil Domestic Supply potential is limited Global prices favourable, as impacted by lanina- India is dominant Player Soybean Oil World India USA China Domestic Consumption 53969 5500 9322 16000 Imports 11069 3800 137 620 Production 54293 1620 10156 15501 18

Sunflower Oil Domestic Supply potential is limited Black sea supplies are increasing- potential for India to increase its potential Sunflower Seed Oil World India USA China Domestic Consumption 15731 1820 230 1325 Imports 7635 1800 45 850 Production 17113 96 226 475 19

India Oil Basket Source – USDA Ending Stocks around 10 pct Domestic Production which is around 30% of consumption- change in domestic production impacts stock status Domestic share in total oil demand going down due to stagnant production 20

Comparative Numbers • China domestic production is keeping pace due to soybean oil production from imported bean to tune of 95 myn mt • Domestic soybean production in China is stagnant • India domestic production is stagnant with limited hope of revival or increase • It is highly inefficient to produce oilseeds in India due to policy constraints • Demand should continuously grow for imported veg oil- but world is finding alternate usage in fuel 21

SE SA Total Demand Supply- Meal Source: USDA, Mc. Donald Pelz Analysis SE + SA demand is increasing for oilseed and Meal Indian supplies are now falling short to meet regional demand 22

% Growth of meat products Source: USDA, Mc. Donald Pelz Analysis SA + SE is fastest growing meat market in the region… It means more oilseed and feed grain demand 23

SEA in Graph- Meal demand S SE demand is increasing for oilseed and Meal Source: USDA, Mc. Donald Pelz Analysis Indian supplies are now falling short to meet regional demand 24

India numbers in Graph- Meal Source: USDA, Mc. Donald Pelz Analysis Tightening Supplies making region more dependent on global supplies 25

It is not only about SND…. .

Soybean and Soybean Oil Veg Oil Prices move in same direction as soybean CBOT 27

Correlation in Soybean and Oil Prices Crude Price and Soybean has high degree of correlation 28

Sunflower Oil and Soybeans Driver for Sunflower Prices is soybean CBOT- US bean production 29

Soybean Oil and Palm Oil Prices Who drives what…. 30

Spreads is the name of the game… 31

In the Nut shell…. . Snd is Driver

Global Production - Soybeans Not adding carry out- Price volatility will go up 33

Global Oilseed Production Major Oilseeds includes Copra, Cottonseed, Palm Kernel, Peanut, Rapeseed, Soybeans and Sunflower seeds. 34

World Soybean Crush expansion on back of increased meal demand in SE Asia 35

India Soybean Crush Reducing Share… China expanding We are helping Argentina Farmers 36

Brazil Key to watch • Argentina excess wet condition compared to last year. • Brazil soybean plantings are just getting started and most of the Brazil growing areas are dry. Soybean planting delayed this year in South America. • India received 5% lower rainfall than normal in the monsoon season, nearly half of the country's farmland lacks irrigation. • USA in July’ 17, 14% of soybean acreage were under drought conditions. Overall, 60% of the soybean crop was reported in good to excellent condition, 14% points below the same time last year. 37

Important Criterions Crush Margin in China is finally positive 38

WE PROVIDE INSIGHTS- Beyond Data and Information to our Customers US So. AM Black Sea China Demand Asia- Producer and Consumer of grains and Oilseed- we are here to cater your requirements Wheat Market sumit@mcdonaldpelz. com +91 -7042537773

WORLDWIDE MCDONALD PELZ India Office 111, Centrum Plaza Sector-53, Gurgaon India Phone: +91 -7042537773 sumit@mcdonaldpelz. com Mc. Donald and Pelz is a cash grain, oilseed, and renewable energy brokerage organization whose aims and goals are to help our customers in the buying and selling of their products. Over the past 32 years Mc. Donald and Pelz has become the industry leader and it is our objective to maintain this status through our growth globally.