Indian soymeal exports likely to recover

 

 

India's soymeal exports are likely to pick up in the last four months of this marketing year, after a slump since October 1 as rival producers sold their produce at lower prices, a senior industry executive said Wednesday (May 5).

 

The country's export of soymeal - used mainly as animal feed - fell 42% to 1.5 million tonnes between October 1 and March 31 from a year earlier, according to industry data.

 

Rajesh Agrawal, the co-ordinator of the Soybean Processors Association of India (SPAI), said the fall is likely to be arrested in June as local farmers are expected to release more soy stocks, which may drive down prices of the Indian soymeal.

 

According to SPAI, India's soymeal exports in April fell 31.5% to 57,507 tonnes from a year earlier. Exports have been falling over the last few months because of weak global demand and higher Indian prices. Soymeal exports in the October-April declined 41.4% to 1.56 million tonnes.

 

Indian soymeal prices in the export markets fell to Rs17,433 per tonne in March from the current year peak of Rs20,700 per tonne in December.

 

The gap between local and international prices widened to around Rs2,500 per tonne during November-December due to high local rates of soy, but narrowed to Rs1,000 per tonne by March responding to the global trend, Agrawal said.

 

He expects soymeal exports to decline 22% to 2.5 million tonnes in the year ending September, despite a likely pickup in shipments in the last four months.

 

"India's soymeal exports fell earlier as good soy crops in the US and South America pulled down global prices. Demand for Indian soymeal declined as our prices remained higher than global prices," he said.

 

India mainly exports soymeal to Vietnam, South Korea, United Arab Emirates and Japan.

 

Indian farmers had held back soy supplies earlier in the year as they were expecting domestic demand to increase for soyoil. However, their plans were dashed as traders opted for cheaper soyoil imports.

 

Meanwhile, India's soyoil imports are expected to rise by more than 40% to 1.4 million tonnes in this oil year ending October.

 

As much as 18 million tonnes of oilseeds, including soy, are yet to be crushed, according to industry data. Farmers are now keen to sell their stocks as the price fall is continuing, and their produce could spoil if they hold it longer.