Govt plans to raise soymeal exports

Sends six-member delegation to importing countries

Faced with a sharp decline in soybean meal and other value-added products’ exports over the past few years, India’s ministry of commerce and industry has decided to send a six-member delegation to major importing countries to understand importers’ problems.

The committee, headed by Davish Jain, chairman of the Soybean Processors Association of India, showed soybean meal exports dropped 66 per cent in August to 10,615 tonnes, compared to 31,157 tonnes a year ago.

During the April-August 2016 period, India’s soybean meal exports recorded a 62 per cent decline to 63,522 tonnes from 168,054 tonnes in the same period last year.

“We are not competitive in the world market because of higher raw material (soybean) prices in India and lower realisation from exports of meal. Our soybean prices are determined by domestic farmers, while refined soya oil (RSO) and soymeal prices are set by crushers in Brazil due to cheap import of RSO,” said D N Pathak, executive director, Soybean Processors Association of India.

Meanwhile, a letter sent by the commerce ministry to embassies in Japan, Vietnam, the Philippines and Thailand seeks extension of full cooperation to the delegation, which would visit these countries between September 18 and 30 to explore the market and meet prospective buyers.

Soybean output down
Soybean crushing has been lower due to a sharp decline in output. Data compiled by the SOPA estimate India’s soybean output at 7.54 million tonnes in crop year 2015-16 compared to 10.37 million tonnes in 2014-15, thus witnessing a decline of 27 per cent. Soybean output, thus, hit the lowest in 11 years in 2015-16 due to drought in major growing states including Maharashtra and Gujarat.

  India would need to increase yield 1.5 times to ramp up soybean output and reduce import of RSO, said Pathak. India currently imports RSO at 12.5 per cent, which the industry urged the government to raise to at least 25 per cent to help raise oil prices and make crushing from local sources viable.

Industry sources believe India’s export of soybean meal has declined to ‘nil’ as the value of India’s exported goods is costlier by $100-150 a tonne in importing countries such as Vietnam, Japan etc compared to sourcing the same from Brazil and Argentina - the world’s two large soybean producers.

“India has been a major exporter of soybean meal to the Far East and SEA (southeast Asia). However, during the past couple of years, our exports have fallen drastically due to disparity in prices. This year, the crop looks very good and there is every possibility that we can re-enter these markets with competitive prices and the added advantage of being totally non-genetically modified,” said the ministry’s letter.

India’s soybean output is estimated to increase on a sharp jump in acreage following a favourable monsoon rainfall this year.