Soy – a versatile raw material
Soy as raw material
The boom of soybean utilization for industrial purposes
started in the 1940s, and has since then grown exponentially.
The main producing countries are the US,
Brazil, Argentina, India, and China, and the biggest
consumers are China, the US, Argentina, and Brazil.
Soybean is a summer crop and its full cycle ranges
from 90 to 120 days. Crop rotation is usually made
with winter crops such as corn, barley, wheat, and
black beans. Yields can vary but on average 1 hectare
produces about 3,000 kg of soybeans and 0.4 MT of oil.
Importance for AAK
The soybean oil is one of the most versatile commodities
with a large number of applications besides food.
The main one is as the source of SME (soy methyl
esters), or biodiesel, but it is also used as raw material
in feedstuff, pharma, paint, personal care, lubricants,
plastics, resins, etc.
From an AAK perspective, soybean oil is rich in
polyunsaturated fatty acids. It is mainly used in baking
fats, mayonnaise, frying oils, salad and cooking oils,
as an ingredient in margarine and wihtin our segment
From a volume perspective, soy is a rather small
commodity for AAK, but because of the sustainability
risks in the supply chain, especially deforestation, it
has been included to the list of key raw materials for
responsible sourcing in 2018.
According to the International Sustainability Unit, TFA,
CDP and Climate Focus, soy is the second largest
contributor, after beef, to global deforestation. It is not
primarily produced for food, but the soy meal goes
into the feed industry, and the oil is used for consumer
goods products or biofuels.
The country in focus when speaking about deforestation
linked to soy production is Brazil. After making
significant progress in environmental protection
alarming statistics have been published by Reuters,
measuring the deforestation in Brazil between July 2017
and July 2018. A record high for the past decade was
measured with a 13.7 percent increase compared to the
previous year. This is a worrying development and calls
companies like AAK to action.
We have set the target in our Policy for Responsible
sourcing of Vegetable Oils, to only source raw materials
that have been produced without High Carbon Stock
deforestation, conversion of High Conservation Value
areas, and development on peatland soils. Therefore, in
2018 we have mapped our supply chains and identified
the traceability levels and risks of deforestation. 91
percent is free from risks of deforestation. In 2019,
we will further work on improving this score.
91% Free from deforestation risks