Growing oilseed crops in Russia

Growing regions and soybean yields in Russia in 2023

Amur region. 1 429 000 tons, 1.6 tons per hectare.
Kursk region. 873 000 tons, 2.6 tons per hectare.
Belgorod region. 731 000 tons, 2.6 tons per hectare.
Voronezh region. 440 000 tons, 2.1 tons per hectare.
Tambov Region. 439 000 tons, 2.2 tons per hectare.
Primorsky Krai. 369 000 tons, 1.4 tons per hectare.
Lipetsk region. 345,000 tons, 2.4 tons per hectare.
Oryol Region. 333 000 tons, 2.2 tons per hectare.
Krasnodar region. 327 000 tons, 1.9 tons per hectare.
Altai region. 271 000 tons, 1.8 tons per hectare.

Аmounted to 6 824 000 with a yield of 1.92 tons per hectare.

Soybean also showed significant growth, the country's harvest increased by 12.3% to 6.8 million tons compared to 6 million tons in 2022.

ANALYTICAL REPORT OF EXPERTS OF THE «GEOBURO» COMPANY on soybeans and soybean meal

The Russian soybean market continues to grow due to domestic production; in the current season, an increase in both gross harvest (+5.4%) and yield (+2.3%) is expected. Our experts talk about a recovery in export volumes in the first half of the year, while the need for imported products is gradually decreasing. The area under soybeans in Russia is also increasing every year - in 2022, soybeans were grown on 3.5 million hectares and in 2023, and this figure will reach 3.7 million hectares (+ 6% year on year). According to this indicator, the leadership is still retained by the central regions of Russia and the Far East. Soybean yields are growing; according to our analysts’ forecasts, in 2023 the positive dynamics will continue and on average in Russia 1.9 tons will be harvested per hectare, which is 2.5% more than in 2022. Against the backdrop of growth in Russian production, the need for foreign products is gradually decreasing. In 2022, soybean imports fell 16% year on year to 1.7 million tons. In the first half of 2023, supplies decreased by 14% compared to the same period in 2022 - to 819,000 tons. The main supplier of soybeans to the Russian market is Brazil, accounting for 96%, or 788 000 tons, of the import structure from January to June 2023. It is worth noting that during the same period last year, Brazil provided 74% of soybean imports.

Analyzing average soybean prices, it is worth noting their downward trend after rising prices in 2021 and 2022. Similar dynamics can be observed in relation to the prices at which soybeans are purchased by feed manufacturers. Thus, in January and June 2023, the average producer price decreased by 29% to $340 per ton.

Soybean meal exports increased 2% year over year (384 000 tons) over the same period. Türkiye received the largest volume - 29%, or 112 000 tons; Belarus, Germany and Uzbekistan each account for approximately 16% of export shipments.

Exports to the Republic of Belarus (11 times per year) and Uzbekistan (almost 6 times) increased significantly. Türkiye, Azerbaijan, Latvia and Tajikistan also significantly increased purchases. In a number of directions, supplies decreased - to Germany by 37% (even though this country is the leading consumer of Russian soybean meal), exports to Denmark decreased by half, to France by 7 times, and to Lithuania by 20 times. This is due to the sanctions imposed on Russia in 2022-2023.

In recent years, Russia has been effectively increasing domestic production of soybeans, as well as its processed products (soybean meal) - our experts assess this crop as STRATEGIC for the livestock industry. As the production of meat products grows, the need for high-protein plant raw materials in the feed industry will increase, which means that the positive dynamics in the domestic soybean market will continue in the foreseeable future, leading to an increase in both the amount of arable land allocated for soybeans and an increase in soybean yields thanks to new varieties and technology processing of non-GMO soybeans in Russia.

It is predicted that in 2024, the area under soybeans in Russia may increase to 4 million hectares. The leader in this indicator will be the Central Federal District, where they plan to sow 1.8 million hectares (+15% compared to the 2023 level). The Far Eastern soybean cluster will remain second in area in 2024 with an indicator of 1.4 million hectares (1.7% more than last year).

In the Central Federal District, the rate of increase in soybean fields is increasing in the Kursk region (growth will be 10%), as well as in the Belgorod (+11%), Voronezh (+17%) and Tambov (+17%) regions.

The largest soybean-producing region remains the Amur Region with a planned planting area of 900 000 hectares. For comparison, the cultivated area in all countries of the European Union is just over one million hectares.

TOP-10 regions of Russia by soybean acreage in 2024, plan (increase in 2024 to the 5-year average):

Amur region (+ 6%);
Kursk region (+ 27%);
Belgorod region (+ 12%);
Primorsky Krai (+ 2%);
Voronezh region (+ 41%);
Tambov region (+ 41%);
Krasnodar region (+ 15%);
Lipetsk region (+ 94%);
Altai Territory (+ 27%);
Oryol region (+34%).

Experts note that the soybean market is growing worldwide, driven by demand from livestock, bio-diesel and food production. Prices for crops are currently declining. However, the demand for Russian soybeans will only increase, since it is grown without the use of GMOs.

PROSPECTS FOR INCREASING SOYBEAN PLANTING IN RUSSIA AND WORLD TRENDS

Over the past decades, the area under soybeans in the United States, Canada and Latin America has increased more than 100 times. In the United States, the area under soybeans has increased 34 times over 78 years (from 1938 to 2016). In Brazil, the area under soybeans increased 935 times over 65 years (from 1950 to 2015). In Canada, the area under soybeans has increased 1 075 times over 77 years (from 1938 to 2015). In Argentina, the area under soybeans has increased 19,800 times over 66 years (from 1950 to 2016). In Russia, soybeans are cultivated on less than 4 million hectares (this is less than 2% of the total cultivated area).

Map of the current state, potential for soybean production and processing (for 2024): it is possible to sow up to 250 million hectares with soybeans, there are 23 soybean processing plants, there is the possibility of a 4-fold increase in soybean and lupine processing capacity.

Growing regions and yield of rapeseed in Russia in 2023 amounted to 4 203 000 tons with a yield of 2 tons per hectare

Krasnoyarsk region. 404 000 tons, 1.9 tons per hectare.
Oryol Region. 292 000 tons, 2.9 tons per hectare.
Krasnodar region. 288 000 tons, 3.1 tons per hectare.
Altai region. 285 000 tons, 1.8 tons per hectare.
Kemerovo region. 261 000 tons, 2 tons per hectare.
Bryansk region. 257 000 tons, 3.5 tons per hectare.
Tula region. 220 000 tons, 2.4 tons per hectare.
Stavropol region. 199 000 tons, 2.1 tons per hectare.
Kursk region. 199 000 tons, 3.2 tons per hectare.
Novosibirsk region. 185 000 tons, 1.6 tons per hectare.
Kaliningrad region. 168 000 tons, 3.4 tons per hectare.

ANALYTICAL REPORT OF EXPERTS OF THE «GEOBURO» COMPANY on rapeseed and rapeseed meal

According to the June forecast of FAS USDA, the world rapeseed harvest in the 2021/22 agricultural year will increase by 2.55 million tons and exceed 74 million tons with consumption of 73.9 million tons.

In 2023, there was a slight decrease in the area of rapeseed cultivation in Russia. According to preliminary data from «Rosstat», the size of the sown areas amounted to 2,108,000 hectares, which, according to calculations by «Geoburo» experts, is 10.0% (235,000 hectares) less than it was in 2022. The area of spring rape decreased, compared to 2022, by 10.5% (by 185 000 hectares) to 1,581,000 hectares. The area of winter rapeseed over the year decreased by 8.7% (by 50 000 hectares to 527 000 hectares).

Rapeseed is grown in all federal districts of Russia, in a number of regions. If we consider the key regions (TOP-10 in terms of collections in 2022), then these include: Krasnoyarsk Territory, Stavropol Territory, Krasnodar Territory, Altai Territory, Kemerovo, Tula Regions, Republic of Tatarstan, Novosibirsk, Bryansk, Oryol Regions.

In 2022, export volumes, according to «Geoburo» experts, increased by 11.3%, over two years - by 28.2%. The main export destinations of Russian rapeseed cake and meal are Lithuania, France, Turkey, Spain, Israel, Latvia and Germany. In 2023, compared to the same period in 2022, the export of meal and cake increased in volume by 3.6 times.

Our experts believe that rapeseed production in Russia will increase and in 2024 may exceed an area of 2.4 million hectares. The expansion will occur due to the spread of rapeseed to regions such as Bashkiria, Kirov region, Vologda region, with the largest growth occurring in Siberia. We will now provide a rationale for this trend. For comparison, with a rapeseed yield of 2 tons per hectare, the income per hectare is the same as if you collect 4-4.5 tons of wheat per hectare, however, such a yield in Siberia simply practically does not happen; whoever receives it - usually the figure is at the level of 1.5-2.5 tons from one hectare.

Russia is increasing its rapeseed crops in sync with other countries that produce this crop. According to ICAR, in the new season, the area under rapeseed in the world may increase by 6% and reach 40 million hectares. Russia can reach 4 million hectares of rapeseed crops by 2027-2028. Prices for rapeseed are very volatile and fluctuate from region to region and from month to month from 350 to 590 dollars per ton.

Growing regions and sunflower yields in Russia in 2023 amounted to 17 253 000 tons with a yield of 1.85 tons per hectare

In 2023, there was a decrease in the area under sunflower cultivation. According to preliminary information from «Rosstat», the area under sunflower in Russia has reached 9 818 000 hectares. Compared to 2022, they decreased by 3.0%.

Rostov region. 2 324 000 tons, 2.5 tons per hectare.
Saratov region. 2 104 000 tons, 1.5 tons per hectare.
Orenburg region. 1 435 000 tons, 1.4 tons per hectare.
Volgograd region. 1,373,000 tons, 1.8 tons per hectare.
Krasnodar region. 1 321 000 tons, 2.8 tons per hectare.
Voronezh region. 1 262 000 tons, 2.6 tons per hectare.
Samara Region. 1,046,000 tons, 1.5 tons per hectare.
Altai region. 925 000 tons, 1.2 tons per hectare.
Tambov Region. 862 000 tons, 2.2 tons per hectare.
Penza region. 579 000 tons, 1.9 tons per hectare.
Stavropol region. 567 000 tons, 2.2 tons per hectare.
Belgorod region. 522 000 tons, 2.8 tons per hectare.

Among oilseed crops, sunflower showed the greatest growth, the gross harvest of which in the country amounted to 17.2 million tons (+2% compared to the previous year 2022).

ANALYTICAL REPORT OF EXPERTS OF THE COMPANY "GEOBURO" on sunflower

In 2022, supplies of sunflower seeds for sowing to Russia from other countries, according to experts from the «Geoburo» company, decreased by 3.6%. However, the first half of 2022 showed an increase in supplies due to an increase in demand amid the expansion of growing areas during that period; the reduction occurred mainly due to imports in the second half of the year, these are seeds for the planting season in 2023.

From January to June 2023, the downward trend in supplies intensified. Compared to the same period in 2022, the volume of imports of sunflower seeds for sowing, according to experts from the «Geoburo» company, decreased by 36.3%.

In 2022 in Russia, the gross yield of sunflower seeds in weight after processing reached a record value for the entire period considered in the study since 1990 and amounted to 16 356 000 tons, which is 4.5% more than in 2021.

In 2022, in weight after modification it amounted to 1.8 tons per hectare, which is 10.0% higher than the value of a year ago. This is the second highest figure for the entire period considered in the study. Higher yields (if we consider the dynamics since 1990) were observed only in 2019, 1.85 tons per hectare. The average annual sunflower yield in Russia from 1993 to 2002, according to calculations by experts from the «Geoburo» company, was more than 820 kilograms per hectare of harvested area in weight after processing, from 2003 to 2012. 1 ton and 70 kilograms per hectare, from 2013 to 2022, the yield increased to 1 ton 560 kilograms per hectare. Consequently, the trend towards increasing productivity is not accidental, it is sustainable and has been observed for many years.

The average indicative export prices for Russian sunflower oil in August 2023, according to «Geoburo» experts, amounted to $850 per ton. Over the month they decreased by 4.2%, over the year by 43%. The purchase price at elevators in the fall of 2023 ranged from $200 depending on the region and reached $220 per ton. In mid-March 2024, farmers and grain elevators were selling sunflower seeds for $230-$250.

Growing regions and yield of flax seeds in Russia in 2023 amounted to 1 153 000 tons, with a yield of 890 kilograms per hectare

The 2023 oil flax harvest is very different from the general trend. Against the backdrop of a sharp reduction in sown areas, the harvest will immediately fall by 30% to about 1.2 million tons. At the same time, Russia will remain the leader in world production with a large gap from competing countries. For comparison, Kazakhstan and Canada will collectively produce about 800 000 tons. The influence of the volume of flax export supply from Russia mainly determines the global price trend.

The total volume of gross harvests of oilseed flax (curly flax) in Russia in 2023 amounted to 1 153 000 tons.

Altai region. 177 000 tons, 750 kilograms per hectare.
Rostov region. 159 000 tons, 1.6 tons per hectare.
Omsk region. 98 000 tons, 580 kilograms per hectare..
Kurgan region. 79 000 tons, 740 kilograms per hectare.
Stavropol region. 70,000 tons, 1.37 tons per hectare.
Crimea. 66 000 tons, 1 ton per hectare.
Novosibirsk region. 62 000 tons, 660 kilograms per hectare.

ANALYTICAL REPORT OF EXPERTS OF THE «GEOBURO» COMPANY on Pancake Day flax seeds

The sown area of oilseed flax (curly flax) in Russia in 2023, according to «Rosstat», was at 1,410,500 hectares, which is 32.6% (683,000 hectares) less than in 2022. However, over 5 years, according to calculations by analysts of the «Geoburo» company, the area increased by 89% (by 665,000 hectares), and over 10 years by 2.9 times (by 932,000 hectares). In 2023, according to «Rosstat», the yield of oilseed flax (curly flax) in Russia amounted to 890 kilograms per hectare; over 5 years it increased by 14.5% (by 110 kilograms per hectare), over 10 years - by 24% (by 170 kilograms per hectare). Flax prices as of mid-March 2024 vary from region to region, ranging from $350 to $500 per ton.

You can read the article FLAX in Russia HERE

WHY DO I NOT MENTION ABOUT CORN, INDUSTRIAL HEMP IN OIL OR AMARANTH OIL IN THE ARTICLE ABOUT OIL CROPS?

In Russia, corn is practically not used for oil production, the main direction of corn in 60% of cases is silage for feeding cattle, another 30% is corn for grain, mainly for feeding poultry and the production of animal feed, and about 10% goes to cobs for food and popcorn production. Corn flour is used very rarely for food and mainly in the North Caucasus in the Chechen Republic, Dagestan and Ingushetia.

Hemp for oil is grown mainly in the Southern Regions and a little in the Black Earth regions. You can read more about technical hemp in our article HERE

Amaranth was not grown in Russia for many years, but now they have begun to cultivate this crop again; it is used for oil, flour, and a larger amount is used as animal feed as an additive to silage. You can read more about amaranth in Russia in our article HERE

When developing a business plan and financial model for entering the Russian agricultural business, you will be interested in reading this article.

OUR COMPANY WILL HELP YOU SELECT AGRICULTURAL LAND IN RUSSIA.

The article was prepared on March 29, 2024 by Andrey Kichaev. LLC "GEOBURO"