In the EU’s Vision for Food and Agriculture released last week it was suggested that products made outside of EU standards could be banned, for instance crops imported using pesticides prohibited.
Some reports indicate that the first target of such a ban could be soy beans grown in America.
The bans are ostensibly to protect EU producers from lower-cost products. How significant are the real benefits?
Bans have short-term effects
Such bans may cause market turmoil in the near future. Susanne fromwald, the general secretary of Donau Soja and the international project leader, said that the EU imports 16% of its total soy production.
Roxanne Nikoro is a market analyst with Expana Markets. She cites data provided by the European Commission to explain that US soy imports grew around 3.18 percent year on year in 2023/2024. Imports from Brazil, however, grew at a faster rate in the same time period (7.7%).
According to Donau Soja’s report on the market, European soy is in a bad state. According to the report, soy areas in countries like Ukraine, Italy, and the Balkans could decrease due to poor yields, low prices, or both.
Soy is a competitor to maize but has some advantages due to lower costs of input and broader sowing period.
The average European non-GMO Soy price in the first half of January was EUR430 – EUR450 per ton.
Impact on the long term
Long-term the effects could be positive, but they would also have mixed blessings.
Fromwald says that “Demand and prices of soybeans could rise in Europe.” This would be good news for European soy farmers.
This would be good news for European Soy, in general. “An additional incentive to grow soy crops in Europe which have already grown by approximately 80% in the past 10 years.”
While soy bean farmers may be pleased with higher prices, feed producers might not be.
Susanne von Fromwald is the General Secretary of Donau Soja and International Project Leader.
Not all farmers will reap the rewards. For example, livestock farmers would suffer from increased soybean feed prices.
Fromwald summarizes the problem: “Whereas soybean farmers may be pleased about potential higher prices for beans, livestock producers at the same might be unsatisfied about higher feed prices.”
The conditions of substitutes could make this worse. Nikoro explains that the EU’s rapeseed production is down this year compared to last, and could further increase feed prices.
Fromwald of Donau Soja says that it is hard to estimate how significant a price increase would be because soybean prices can fluctuate wildly.
Other factors, beyond US imports, could also affect the price. Although the EU imported more US products this year (3.6m metric tons) than Brazil (2.4m t), that could change in the future if there are bans.
Sources suggest that the EU could switch to Brazilian beans and others of other origin, which would limit price increases.
