Constructing Bigger Opportunities for U.S. Soy in the Middle East
With a new U.S. Soybean Export Council (USSEC) office opening in Dubai, United Soybean Board (USB) Director Bob Metz traveled to the Middle East to meet with potential buyers of U.S. soy. In this conversation with Beyond the Bean Online, Metz explains how the young population of many countries in the region translates into a growing market for soy exports.
Q: Why did USSEC open an office in Dubai?
A: The Dubai office will service our Middle East and India customers. We opened the office in Dubai because it is centrally located between these two markets. Dubai is a two- to three-hour flight from almost anywhere in the Middle East and India, which makes it easily accessible. It is also an extremely safe country, so there aren’t any security issues.
Q: Does the U.S. currently export soybeans to Middle Eastern countries?
A: Absolutely. The region is made up of young economies, and many people in the region have alternative eating habits, whereas people in an aging economy, such as in Japan, primarily eat more meats. Economies in the Middle East are flourishing and great potential lies ahead for the middle class as these countries transition into democracies.
Q: How about India?
A: India, on the other hand, is actually a reverse market because it currently exports its own soybeans and soy meal. We feel that within the next three years, as India’s economy continues to grow, poultry consumption will increase because most people of the Hindu religion do not eat beef. Poultry, of course, are the single biggest user of soy meal, so increased consumption could mean more U.S. soy meal. At one time, China was a reverse market, but now it’s our No. 1 export market. We have high hopes that India will follow a similar path.
Q: Are there certain soy products the Middle East is looking for?
A: It varies from country to country according to who has soybean crushing plants and who doesn’t. The United Arab Emirates, where Dubai is located, has two modern crushing facilities, so they’re a whole-bean market. Other countries that do not have crushing facilities are interested in importing meal and oil. We work country to country according to their needs.
Q: Is USB concerned about security issues in the Middle East?
A: As the market shifts, we have to be more agile in our ability to help out where we’re needed. For example, Syria used to be a huge soybean importer and crusher that delivered soybeans and soy meal to its neighboring countries. When the civil war started there, it nearly fell off the radar as far as soybean crushing, and its surrounding countries picked up the slack. At the end of the day, whether you’re in a civil war or not, people still need to eat. All in all, soybeans need to be continually moving into the Middle East, and we want to serve as their resource moving forward.
Q: What lies ahead for U.S. soybeans in the Middle East?
A: The Middle East holds huge market potential for U.S. soy because of its growth opportunities as a young population. Throughout this region, they have excellent poultry production, which is comparable to U.S. standards. Our goal is to set a competitive price that is reasonable with the supply available. We always like to set a small premium for our expertise, which bodes well for U.S. soybean farmers.