A gradual decline in overseas demand due to recessionary pressure coupled with the government’s intended punitive action resulted in a 63 per cent decline in oilmeal exports in July this year.
According to data compiled by the Mumbai-based Solvent Extractors’ Association (SEA), total exports during the month reduced to 173,329 tonnes as compared to 474,590 tonnes in the corresponding month last year.
In the first four months of the current financial year, cattlefeed shipments slumped 59 per cent to 787,857 tonnes as compared to 1,908,396 tonnes in the same period last year. B V Mehta, executive director, SEA, attributed India’s poor performance to the worsening demand in Southeast Asian countries as they were the major importers of Indian meal. Mehta also blamed the government’s indicative suspension of oilseed exports early July that hampered sentiments in overseas markets for two-three days.
| Exports during April-July (in tonnes) | ||
| Oilmeal | 2008 | 2009 |
| Soybean | 1,389,996 | 345,315 |
| Rapemeal | 352,156 | 355,608 |
| Groundnut | 5100.00 | — |
| Sunflower | — | 726.00 |
| Ricebran | 94641.00 | 44918.00 |
| Castormeal | 66,503 | 41,290 |
Though, the government clarified that there was no such proposal to suspend exports, and the market recovered soon, yet the sentiment remained scary with traders focussing on the domestic market. Since overall oilseed and oilmeal output was low last year, total supply in July was also less as compared to the same month of the previous year when there was a bumper crop.
Meanwhile, domestic demand has improved significantly, giving no reason as to why producers would opt for exports when realisation in the local market was almost on a par with exports, said a trader. Mehta argued that oilmeal exports supported better realisation for local farmers. The export market of oilmeal has developed after great efforts in many years and India was now enjoying the reputation of a dependable supplier. Once punitive action was taken, it would be difficult to recover the same sentiment in the market, he added.
During the period between April and July 2009, China bought 137,252 tonnes of oilmeals, mainly consisting of rapeseed meal of 136,592 tonnes and a small quantity of soybean meal.
However, exports to Vietnam steeply reduced to 238,232 tonnes from 511,401 tonnes in April-July 2008. Similarly, exports to South Korea, Japan, Indonesia and Thailand have also reduced due to reduction in consumption.
