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M.R. Subramani

Chennai , Oct. 5

CHINA has increasingly begun to show interest in oilmeals from India and the solvent extraction industry sees a big market there.

Besides, the solvent extraction sector is focussing on the South Asian region to increase demand and improve exports.

"China is interested in Indian oilmeals. We are getting enquiries. Last year, it bought a good quantity including one lakh tonnes groundnut meal. This year too we expect to ship some quantity," said Mr B.V. Mehta, Executive Director, The Solvent Extractors Association of India.

According to reports from Honk Kong, China could buy as much as one lakh tonnes of soyameal this year as it has cut imports of soyabean this year.

"We are trying to promote exports of oilmeal, especially soyameal, in the SAARC (South Asian Association for Regional Cooperation) region. Last year, we exported two lakh tonnes to Pakistan, Bangladesh, Nepal, Sri Lanka and Maldives," said Mr Mehta.

The Soyabean Association of India Chairman, Mr Rajesh Agrawal, said Pakistan, in particular, was showing interest in Indian soyameal for its poultry sector. "We are seeing some interest from Bangladesh also," he said.

Currently, of the 1.5 lakh tonnes of orders in hand for soyameal exports, demand from Pakistan and Bangladesh was 50,000 tonnes.

"We expect soyameal exports to the SAARC region to touch five lakh tonnes this year," Mr Agrawal said.

Exports to Pakistan are done by rail, while to Bangladesh by road. "A year ago, we had problems in sending consignments to Pakistan due to railway wagon problems. Hopefully, we may not witness it again," said Mr Mehta.

According to industry sources, exports to the SAARC region could come in handy especially when the prices for the meals are expected to be "stable or a little lower".

"We see a glut in oilmeal availability this year. As a result, soyameal is expected to rule between $185 and $210 a tonne f.o.b," said Mr Mehta. On Tuesday, soyameal was quoted at $190-192 f.o.b Kandla/Bedi port.

Still, South-East and Far-East Asia are expected to be major buyers of soyameal. " Japan, Taiwan, Thailand, Philippines and South Korea account for 70-80 per cent of the total meal exports," Mr Mehta said.

With freight rates ruling higher, Indian soyameal is seen very competitive in these markets. On Tuesday, Indian soyameal was quoted $236-237 a tonne c&f, while Brazilian soyameal ruled at $252 and Argentine at $242. Even in Thailand, domestic soyameal was quoted at $242, giving the Indian meal a distinct advantage.

Though a record 73-74 lakh tonne production of soyabean has been projected this year, the industry is waiting for crushing to begin.

"Meal prospects will hinge on bean availability and price," said Mr Agrawal.

Currently, arrivals have just begun and soyabean is ruling around Rs 12,000-13,400 a tonne. Industry sources feel prices could begin decline once arrivals pick up.

"We have to remember one more thing. Soya may gain this year since about five lakh tonnes fall in groundnut crop has been projected. That could be a sort of boost to growers who opted for soyabean this year," Mr Agrawal said.

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