India’s soymeal exports are set for a revival as the price gap with the other major supplier, China, is narrowing.
Till recently, traders in India were quoting soymeal above $450 a tonne, as compared with $400 a tonne that players in China were quoting. This resulted in a shift in demand from India to China, following which the price surged by a hefty $50 a tonne there as well. In Asian importing countries, including Korea, Taiwan, Japan, Thailand and Indonesia, the landed cost of the feedstock comes to around $475 a tonne.
The last trade took place in India at $455 a tonne, a couple of days earlier, translating into Rs 22,435 a tonne. Chinese traders are quoting at $475 a tonne. Considering $20 a tonne freight rate from India, prices of meal are workable, unlike earlier.
“Since the shipping time from India, especially to South American countries is 20-30 days, much lower than that of 45 days from China, importers may turn to the inherent supplier, India,” said Rajesh Agrawal, co-ordinator and spokesperson of the Soybean Processors Association of India (Sopa).
Also, meal supply is likely to increase in coming months, as farmers have started offloading their stocks to mills for crushing. Being a byproduct of soyoil, any fresh addition in soybean supply for crushing will increase the availability of meal.
Anticipating lower supply of meal in India, traditional importers had shifted their orders to China in recent months. Export orders to India dried up completely. Since farmers have started supplying soybean to mills for crushing, meal supply may ease soon, followed by export orders, said Agarwal.
Meanwhile, India’s oilmeal exports declined sharply by 70.92 per cent in May, to 89,156 tonnes as compared to 306,615 tonnes in the corresponding month last year. Shipments in April have nosedived 84.75 per cent, to a meagre 83,894 tonnes from as much as 550,180 tonnes in April last year.
During the first two months of the current financial year (April-May), the shipment was recorded at 0.17 million tonnes, a decline of approximately 80 per cent from 0.86 mt in the corresponding months last year. For the current oil year, however, the decline in exports was about a third, from 40.81 mt to 27.55 mt.
According to Sopa data, arrivals of soybean increased to 190,000 tonnes in April, as compared to 86,000 tonnes in the same month last year and 154,000 tonnes the previous month.
