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Description | Overview | History | Cultivation pattern | Soybean producing countries | Indian soybean market | Major trading centers | Contract specifications

Soybean belongs to the legume family of East Asia and is related to peas and clove. It is an oilseed bean, oval in shape, which is produced on a bush-like, green soybean plant. Size of soybean is like the size of a common pea. As, it provides oil and protein in bulk; soybean is also called a miracle crop. It comprises around 45% proteins and 18% oil.

This, 5000 years old, crop is very nutritive in nature and a wide variety of climates and soils support this crop. It also contains unsaturated fatty acids in high proportion.


The most popular and the largest produced oilseed in the world is soybean. It has got the support of wide variety of climates and soils and that is why it is considered to be the most economical crop and has a good worth. Before 2nd world war, soybean was not considered an important crop and thus was not used on a large scale. But after the war, it rose up as one of the most important crop of the world

Soybean production constitutes around 55% of the total world production of oilseeds and figures around 170-185 million tons. The production of soybean has showed an increase of 5.35% during the last 10 years. Around 30% of the world’s total produce is traded annually. USA is the leading producer of soybeans followed by Brazil and Argentina. The major exporters of soybean in the world are: -

  • USA with the total exports of 20-30 million tons
  • Brazil with the exports of 12-18 million tons
  • Argentina with 5-10 million tons exports

  The major importers of soybean in the world are: -

  • China with the total imports of 18-20 million tons

  • European Union with the total imports of 15-18 million tons

. About 85% of the soybean produce is crushed and bi-products of soybean are derived. On crushing soybeans, 18% soyoil is recovered and the rest in soymeal. Crushing or processing, nowadays, is done with the use of chemical methods. These by-products are traded individually but are not annually produced. In other words, we can say that, soybean can be used in different forms broadly divided into the following categories: -  

1)      Soybean as a whole – In this category, usually the seeds of soybean are consumed. It includes various types of edible forms of soybean like bean sprouts, baked soybean, soybean flour for baking purposes, roasted soybean for confectionary purposes, soy butter, soy coffee and most importantly soy seed.

2)      Soybean meal – Soybean meal comprises of the remnant after the soybean oil extraction. It has high protein content and is easily digestible and that is why it serves as a very good fertilizer and as an animal feed. It accounts for about 65% of the world’s total feed. The world’s total production of soybean meal was around 132 million tons in 2003. The leading soybean meal producing country is US in the 1st place and China, Brazil in the 2nd & 3rd place respectively. The leading soy meal exporting countries are: -

  • Argentina (20 million tons)
  • Brazil (15 million tons)
  • USA (6 million tons)
  • India (4 million tons)
  • European Union (2 million tons)

The global trade of soybean meal is about 48 million tons. The major importers of soybean meal are: -

  • European Union (22 million tons)
  • Central Europe (3.5 million tons)
  • Thailand (2 million tons)
  • South Korea (1.5 million tons)
  • Indonesia (1.5 million tons)
  • Japan (1 million tons)
  • Philippines (1 million tons)
  • Canada (1 million tons)

3)   Soy oil – Soy oil is extracted from the basic soybean through complex refining process. This complex process helps in deriving at the soy oil removing the material, which may affect the color and the taste of the oil. After palm oil, it is the most important edible oil traded in the international market. It accounts for 22.85% of the total trade volume of the edible oils in the world. The contribution of soy oil in world’s total oil production has reached around 25% after increasing 5.8% during the last 10 years and figures around 31 million tons. Its consumption is also risen up after the contribution of major producing nations. Countries like U.S, China, Argentina and India has a strong consumer base. Consumption has also risen in other nations like European Union, Central Europe, Egypt, Morocco, Mexico, and Brazil. The leading exporting countries of soybean oil are Argentina with 5 million tons of exports and Brazil with 3 million tons of exports. The leading importing countries of soy oil are China with an import of 2.5 million tons and India with 2 million tons of imports.  


The origination of soybean lies in the northeastern areas of China. It was cultivated about 5000 years ago and was considered as one of the sacred crops. Asian people have been eating soybeans and also using it in different medicines. A 2200 B.C written record had been found in China relating to soybeans. Soybeans started to become popular and reached Japan and China by 1st century A.D.

  When soybeans were introduced to U.S.A, it was not given the due importance. In the early 1900’s, it was a subject of testing for the American scientists. America introduced more varieties of soybean during this period. After the 2nd world war, production of soybean increased dramatically and since then the same scenario continues.

Cultivation pattern

Soybean is basically a summer crop, as it needs a hot and humid climate to prosper. It is a bush like green plant which borne the soy seeds. The soybean plant usually needs 2 months to get mature. When the seeds start to get mature, the leaves of the plant start to fall. This is the stage when the harvesting of this crop is done.

  In June, soybean crop is usually sown in India i.e. it is a kharif crop. In some states, it is cultivated two times a year. The harvesting period for soybean crop in India comes around September and October. It is a highly dependent on rain and a change in the rainfall pattern affects the production of soybean.

  Market sees the arrival of the soybean crop in August-September in US and China, in October-November in India, in January-February in South America.


Soybean producing countries


  • United States

  • Brazil

  • Argentina

  • China

  • India

  • Paraguay

  • Canada

  • Indonesia


Above mentioned are the major producers of soybean. All the producers of soybean add up to a world total production of around 185 million tons. With the increase of the world consumption of meat, the demand for a higher production of soybean is also rising as it serves as a very good feed for livestock. Soybean is generally cultivated in the same areas in which corn is cultivated. After their harvest, it is sold to the crushers who crush the soybean to extract its by-products like soy meal and soy oil. The leading producers of soy meal are: -

  • United States (35 million tons)

  • China (22 million tons)

  • Brazil (22 million tons)

  • Argentina (21 million tons)

  • India (5 million tons)


United states is also the leading producer of soy oil with an annual production of 8.3 million tons. Brazil, Argentina and China come at 2nd, 3rd and 4th place in soy oil production

Production of soybean in India

  • Madhya Pradesh
  • Maharashtra
  • Rajasthan
  • Karnataka
  • Uttar Pradesh
  • Andhra Pradesh
  • Nagaland
  • Gujarat

The annual production of soybean in India is around 7 million tons. Madhya Pradesh being the leading producing state of India contributes to around 75% of the total Indian production and is also called the soybean bowl in India. Likewise soybeans, the rate of production of soy meal in India is on an increasing level with a production figure of 5 million tons. Soy oil is considered as one of the most important edible oil in the country. Indian production of soy oil is around 1 million tons annually and it accounts for about 18% of total consumption of oils in the country.


Indian soybean market

Soybean holds a very important position in the Indian agriculture and economy and it has a worth of over Rs 5000 crores As mentioned above, it stands at the 5th position in the list of the leading soybean producing countries with a production figure of around 7 million tons. Madhya Pradesh has the lead among the soybean producing states in India. Regarding consumption of soybean in India, it holds the 6th position in the leading consuming countries.

Of the total production of soybean in India, 10-12% of it is directly consumed and the rest is crushed to derive soy meal and soy oil. Indian soy meal is considered to be one of the premium soy meals and European and Asian countries prefer to use it other than any soy meal. India export approximately 65% of the total soy meal produced and has turned out to be one of the largest exporter of soy meal usually to the Asian countries. The soy meal is exported to the following countries: -

  • South Korea
  • Thailand
  • Philippines
  • Japan

Though soy meal is not imported to satisfy the growing domestic demand, but this is not in the case of soy oil. A large share of soy oil consumed in India is imported from Argentina, Brazil and US. In fact, soy oil is not permitted to export in bulk. About 1.5 million tons of soy oil is imported which makes the availability of oil in the country at 2.5 million tons. Moreover the rate of imports is still at a rising level.

The prices of soybean in the Indian market are highly volatile because they depend on the prices of the international market. As reference markets, the markets at Indore and Mumbai are looked upon.

  Market Influencing Factors

  • Weather most importantly during the pod bearing period.
  • Prices of the competitive commodities including oils.
  • Movement in prices in the international market.
  • Pests and diseases.
  • Fundamentals of the feed sector.
  • Crush margin
  • Infections affecting poultry and cattle.


Major trading centers of soybean


  • Chicago Board of Trade (CBOT), Chicago-largest soy futures market
  • Dalian Commodity Exchange, China
  • Argentina
  • Brazil

In India, soybean is traded at

  • Indore

  • Ujjain

  • Dewas

  • Mandsore

  • Astha

  • Nagpur

  • Sangli

  • Kota  

Also, soybean is traded in Indian commodity exchanges namely, National Commodity & Derivatives Exchange ltd, Multi Commodity Exchange of India ltd and National Multi Commodity Exchange of India ltd and National Board of Trade, Indore.


Contract specifications of soybean and its by-products in various commodity exchanges

Future contract specifications of soybean in NMCE, NCDEX and NBOT

Future contract specifications of soy meal in MCX, NCDEX and NBOT

Future contract specifications of soy oil in MCX, NMCE, NCDEX and NBOT

Future contract specifications of other soybean derivatives in MCX and NMCE

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