September 28, 2009

India, Asia's biggest soymeal exporter, has contracted to ship 650,000 tonnes to 700,000 tonnes of the animal feed ingredient in the December quarter amid expectations of a record crop, a trader said.

 

Soy output may total 10 million tonnes in the harvesting season starting October 1, up from 8.9 million tonnes this year, said Atul Chaturvedi, president of Adani Enterprises Ltd., India's biggest farm-goods trader.

 

A bigger soy crop in India may cut sales of animal feed by processors including US-based Bunge Ltd. and Latin American suppliers to Japan and South Korea, the biggest buyers. Soymeal prices, down 16 percent in the past year, may drop further as the US gathers a record crop, Chaturvedi said. 

 

US soy production, the world's largest grower and exporter, will climb to a record 3.245 billion bushels this year, up 9.7 percent from last year, the USDA estimated on September 11. Drought this year damaged the soy crop in Argentina and Brazil, the second- and third-largest producers.

 

Soymeal for delivery in December lost as much as 0.3 percent to US$278.50 a short tonne in Chicago. That compares with about US$360-US$365 a long ton for the commodity supplied to Indian ports on the western coast, according to Chaturvedi.

 

India's soymeal exports may total 400,000 tonnes in the two months ending September 30, recouping from a 37-percent decline in sales to 2.9 million tonnes in the 10 months to August 31, the Soybean Processors Association of India said in August.

 

Area sown with soy rose to 9.67 million hectares as of August 31, compared with 9.62 million hectares a year earlier, the association said on September 4. The central Indian state of Madhya Pradesh, the biggest grower, boosted the area under the crop by 3 percent to 5.29 million hectares, the group said.

 

Processors may crush as much as 3 million tonnes of soy in the October-December period, Chaturvedi said.

 

Rains over central states, including Madhya Pradesh, have been near normal in the June-September monsoon season, bucking dry weather conditions that have caused a drought in almost half the country, according to the weather bureau.

 

Soymeal, India's largest meal export, is added to poultry feed as a form of protein to aid birds' growth. The country usually exports more than 70 percent of its output.