Soymeal prices fall 60% on bird flu reports

Amidst reports of bird flu spreading in West Bengal, prices of soymeal, a key poultry feed after maize, have plunged.

At NCDEX, the spot prices of soymeal dropped by around 60 per cent to Rs 625 from Rs 15,150 a tonne on Monday. Prices at Indore, a major trading centre, saw the rates falling by Rs 1,000 a tonne since the outbreak of bird flu.

At Indore physical market, prices have sharply gone down to Rs 15,000 a tonne on Monday from Rs 16,000 on January 15, Indore-based trader Bajrang Goyal told PTI.

"Panicked oil meal traders are not buying soymeal owing to bird flu spreading in the eastern state of the country. As a result, demand has lowered and prices too have been affected," he said.

Besides bird flu, weaker international trends are also impacting the domestic prices.

On the Chicago Board of Trade (CBOT), soybean and soyoil futures continued its downward trend following prolonged profit taking on the recent rally.

"Now, traders have started liquidating their long positions in the global market. At domestic front, confirmation of bird flu in West Bengal weighed on prices," Karvy Comtrade analyst Veeresh Hiremath said.

Central Organisation for Oil Industry and Trade (COOIT) Chairman Daviash Jain said, "Soy meal prices have softened because of some reaction seen in CBOT. Also, prices took a beating following falling crude oil prices and weaker stock markets across the globe".

"However, it is a temporary fall..." he noted.

All the export demand for soymeal has remained strong though there may have been slight fall in the local market, Jain said, adding, "demand from other countries for soymeal is strong though there have been some transport bottlenecks".

"The slow movement of inventory is affecting the market. A shortage of rail freight wagons and congestion and berthing delays at ports have hit shipments," he said.

India's export of soymeal fell to 1,981,225 tonnes during April-December 2007 from 2,159,225 tonnes in the year-ago period, according to the data released by Solvent Extractors' Association of India.

Soy meal is the most used protein supplements and it accounts 25-30 per cent of the total poultry ration.