The report, which is unique in its focus on EU Non-GMO crops, shines a spotlight on the main trends and watchpoints in the Non-GM market, including the developments in supply, demand and prices for these key crops.
Non-GMO soy: an EU record recent harvest
When it comes to Non-GMO soy (all of the soy grown in the EU is Non-GMO), supply in the EU has significantly improved, driven by a record harvest in 2023: EU soy output grew by 33% to 3 million tonnes in 2023. A rough estimation suggests that the EU soy output covers around 40-50% of its Non-GM demand – with the rest imported from countries such as Brazil. This positive trend looks set to continue during this year, with the EU’s soy area forecast to expand by 5-10%, to a record of 1.1-1.2 million ha (according to estimates). This is because of favourable market conditions, such as relatively high soybean prices. EU Non-GM soy prices remained resistant to the recent 10-15% price decline in the global soy markets.
The report highlights the context which drives this positive trend in the EU’s Non-GMO soy sowing area, including relatively high Non-GM soybean price levels compared with rival crops, such as maize; the declining, but still relatively high fertiliser and energy prices (soy needs limited fertilizer),
the relatively high soy yield in 2023, which is likely to encourage some farmers to plant soy again.
Brazilian Non-GMO supply
Despite the good soy harvest in 2023, the EU remains dependent on Non-GM soy imports to satisfy its Non-GM demand – traditionally mostly from Brazil. The main soy harvest season in Brazil usually runs from March to April. The certified Non-GM soybean output in Brazil is predicted to slightly drop to 2.3 million t (≈1.5% of the total harvest) in the current 2023/24 season, according to the ProTerra Foundation’s estimates. Despite a smaller harvest, this volume is still likely to be enough to cover the European Non-GM soy feeding programmes which are based on imports from oversees. The lower Non-GM output in Brazil is due to the lack of Non-GM demand in Europe and the low Non-GM premiums observed at the latest planting season in Brazil (Sep-Nov 2023).
Soybean prices
In early February, Non-GM soybean prices moved at 450 EUR/t at the Bologna Exchange, a benchmark price for Non-GM soybeans in the EU. This price level is 3% lower when compared with its recent peak in late December 2023. Soy prices in the EU normally closely follow the Chicago Board of Trade (CBOT) which is the main benchmark for the global soy industry. But EU Non-GM soybean prices remained relatively stable despite the 10-15% decline observed at CBOT between November and early February.
EU soy – looking to the future
A recent report by the European Commission (the DG AGRI mid-term outlook) forecasts that the soybean area in the EU-27 will expand by 30%, to 1.3 million ha by 2035, up from 1.0 million ha in 2023. The report predicts a shift in the use of land in the EU from cereals to soybean and pulses between 2023 and 2035. This land-use shift is driven by expectations of lower demand for cereals as feed, policy incentives to support crop rotation and the production of protein crops, growing demand for plant proteins and regional products, an increase in GMO-free labelled products; and a push for deforestation-free soybean.
Non-GMO Maize – A Strong Harvest and Good Supply
The vast majority (over 99%) of maize produced in the EU is Non-GM. As the result of a good domestic crop in 2023, the Non-GM maize supply in the EU is likely to remain plentiful and easily cover the Non-GM demand in 2023/24. The harvest bounced back last year from 2022’s drought-affected crop and reached an output in the EU of 61.4 million t in 2023 (up 15.6% on the previous year). In 2024, maize production in the EU is forecast to slightly expand to 8.8 million ha / 63.7 million t. The longer-term outlook for the EU’s maize production looks positive with DG AGRI’s mid-term prognosis predicting that the EU maize area will expand slightly to 8.8 million ha by 2035 (from 8.5 million in 2023).
Maize Prices - Down
Maize price at Euronext (Europe’s leading stock exchange for several agri-commodities, including maize) dropped below 180 EUR/t in early February and moved roughly 10% lower versus Nov 2023. The current price level is the lowest for more than three years. The decline in maize prices followed the record harvests in the second part of 2023 in the USA and China, the two biggest producers worldwide.
Non-GMO Rape
The EU’s Non-GM rapeseed market is well supplied in 2023/24 as the result of a large EU harvest and abundant Ukrainian imports in 2023. Ukraine, which harvested a record crop of 4.3 million t in 2023, is traditionally the most important rapeseed exporter to the EU and has a low level of GM varieties in its rapeseed fields. Looking forward, the EU rapeseed output is tentatively forecast to be 18.4 million t in 2024. This volume would be 1.4 million t lower (-7%) compared to 2023’s harvest. The EU-27 rapeseed area is forecast to decline by 2.7% to 6.0 million ha for the 2024 harvest, mainly due to lower rapeseed prices and unfavourable weather in the planting season.
When it comes to the longer-term prospects for rapeseed cultivation in the EU, DG-AGRI forecasts that the rapeseed area will decline by 8% to 5.7 million ha in 2035 (from 6.2 million ha in 2023). EU rapeseed production is predicted to drop by 3.2% by 2035 (from 18.7 million t in 2021-2023), driven by lower demand for biofuels in the EU.
Non-GMO rape prices – also declining
Non-GM rapeseed at Euronext was traded at 420 EUR/t in early February, down 5-10% lower compared with price levels in November & December. Non-GM is expected to remain the standard in the EU rapeseed market in 2023/24, and hence has no higher price than GMO rapeseed. Rape prices often react to soy and wider oilseed news closely because of the high potential of rapeseed as a substitute in protein feed and vegetable oil (e.g. soy meal is often replaced by rape meal in feed). Rape meal has thus returned to the price level of Oct 2023 and followed the fall in soymeal price.
The full report can be found here.