SOURCE: Freedonia Group

October 19, 2005 11:07 ET

US Soy Products Demand to Reach $8.7 Billion in 2009

CLEVELAND, OH -- (MARKET WIRE) -- October 19, 2005 --US demand for soy products is expected to increase over 5 percent per year to $8.7 billion in 2009. Historically, soy products have been primarily consumed in the food market. While soy and soy-based ingredients will continue to penetrate the food and beverage industry, industrial applications will grow at an impressive 14 percent annual rate and will comprise almost ten percent of soy product demand in 2009. Rapid growth in industrial applications will be the result of continued intense research and development activities among soy industry participants, and a growing desire by government and business to reduce dependence on imports of petroleum. Among industrial end uses, the most favorable opportunities will arise in biodiesel and plastics. These and other trends are presented in "Soy Products & Markets," a new study from The Freedonia Group, Inc., a Cleveland-based industrial market research firm.

Soy-derived chemicals are expected to record the fastest growth, nearly 14 percent annually, with gains led by methyl soyate and isoflavones. Demand for isoflavones will be stimulated by increasing requirements in nutraceuticals to alleviate menopausal symptoms and maintain bone density. Demand for methyl soyate in biodiesel fuel will be boosted because it can reduce pollutants, is a renewable resource and can help to lessen US dependence on imported energy products.

Soy protein products are projected to advance almost six percent annually, bolstered by FDA approval of health claims relating soy protein to a reduction in the risk of coronary heart disease. While the popularity of high protein/low carbohydrate diets has faded, dietary trends featuring a wider range of protein sources will provide opportunities for soy.

Demand for soybean oils (excluding oil used in the production of chemicals) will be restrained by maturity in the food market, competition from other edible oils, and a loss in the popularity of fried foods. A shift in product mix from hydrogenated oil to nonhydrogenated types (with a lower trans fat content) will provide growth. Expanding applications in the industrial market, where soy oil is valued for its biodegradability and plentiful supply, will also promote growth. Soy milk will continue to benefit from an established presence in such mainstream retail channels as grocery stores and mass merchandisers, and from a spate of product introductions featuring new flavors and improved sensory qualities.

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