March 11, 2013

 

Iran to receive more India soy in 2013

 

 

Iran will receive higher supplies of Indian soy at an estimated amount of 0.8 million tonnes by March 2013, and 0.75 million tonnes during the leaner season of April-September 2013.

 

This is despite the crop of beans in Brazil, Argentina and the US that will be harvested and crushed from April onwards.

 

During April 2012-January 2013, exports to Iran reached 5,40,000 tonnes, against 2,30,000 tonnes in 2011-12.

 

For February-March 2013, an export of 3,00,000 tonnes (or 1,50,000 tonnes per month) is expected. The trend may continue, as Iran's public and private sectors intend to aggregate more than adequate stocks for their food-related items to meet any exigencies.

 

Iran has to cover its demand of soymeal for its livestock and has few sourcing options other than India. Even basmati rice exporters are enlarging their export basket by pushing soyameal exports.

 

Decline in soymeal shipments to Japan and Vietnam this year may, therefore, be compensated.

 

Exports of about four million tonnes (1.5 million tonnes to Iran and 2.5 million tonnes to other destinations) are achievable in 2013-14, out of a total production of about eight million tonnes. Farmers and producers who held back beans or accumulated inventory of meal in anticipation of better realisation due to Iranian purchases may also have to contend with the falling trend in world prices, which will be a limiting factor.

 

World soy prices are estimated to fall by 20%- 25% in the next two quarters.

 

MNCs, who may have otherwise sourced soymeal for Iran from South America in April-September, have also diverted their business through Indian intermediaries or sister companies based in India.

 

Exports of value added non-traditional items such as soymeal, which is undertaken by private players from open market, will be welcomed by the Indian Government.

 

More crushing of beans will yield more oil, lowering prices of edible oil and bringing down imports.