Soyabean (B – Trams): Rising prices and tax policy changes in Pakistan are hindering demand from the poultry sector and capping edible oil demand, leading to only limited growth in soybean and vegetable oil imports forecast for 2021-22, according to the latest Global Agricultural Information Network (GAIN) report from the US Department of Agriculture (USDA).
The USDA forecasts 2021-22 total soybean and canola oilseed imports to be about 3.3 million tonnes, reflecting a more modest annual growth rate than previously anticipated. In 2020-21, Pakistan imported 3.23 million tonnes of oilseeds.
Poultry, livestock and aquaculture, which drive soybean import demand, are facing broad economic headwinds, the USDA said. The poultry sector, the leading user of soybean meal, is confronting many challenges limiting expansion, including:
- Prevailing high prices for almost all inputs, especially energy and feed;
- The government’s recent implementation of a new 17% sales tax on key inputs;
- Difficulty transferring these higher costs on to consumers via higher retail prices;
- The foodservice, hospitality and events sectors’ continued struggle to resume full operations following a nearly two-year period of extreme uncertainty;
- Additionally, continued weakness and volatility of the Pakistani rupee is clouding soybean import prospects.
While growth from the aquaculture and dairy sectors is promising, they make up a small percentage of the estimated 9 million tonnes of annual domestic compound feed use, the USDA said.