October 16, 2013

Due to heavy rainfall which has disrupted harvesting, India is likely to export less than 250,000 tonnes of soymeal in October 2013 compared with an earlier estimate of some 450,000 tonnes.

India's soymeal exports compete with South American shipments in Asian markets. Lower supplies from India could force Japan, Iran, Indonesia and Thailand to buy spot cargoes from other suppliers, like Vietnam.

"Oil millers are not able to operate crushing plants with full capacity. They are not getting soy for crushing due to rainfall," said Rajesh Agrawal, chief co-ordinator at the Soy Processors Association of India (SOPA).

In the last two weeks, soy harvesting in Madhya Pradesh and Maharashtra, India's top two producing states, was disrupted by heavy rainfall. This may bring output estimates for the 2013-14 season down from SOPA's previous estimate of 13 million tonnes.

Agrawal said that demand for Indian soymeal is robust from overseas buyers, but mills are not able to fulfil orders.

Oil mills in India have signed deals to export 750,000 tonnes soymeal for October to January shipments, said an Indore-based dealer.

In September, the industry was divided over soy output forecasts, with estimates between 11 million and 14 million tonnes, depending on views about rain damage to crops in August and September.

Heavy rainfall in the first two weeks of October has increased the damage to crops and the SOPA has already started a reassessment process to determine the crop size, Agrawal said.

As of October 4, there were 12.22 million hectares reserved for soy cultivation in India, compared with 10.68 million hectares a year ago, farm ministry data showed last week. Farmers grow soy once a year during the rainy months of July and August, and harvest summer crops from October. Soy output also helps to determine the edible oil imports of the world's top buyer.