Soymeal prices in India are likely to come under pressure this fiscal due to higher acreage under cultivation and lower exports demand.
As on July 18, the soybean acreage stood at 110 lakh hectares (ha) across the country as against 86.2 lakh hectares last year, according to Solvent Extractors Association of India.
“The soymeal price has been on the decline since May 2013 as exports demand dropped, thereby increasing domestic supply. With monsoons being above normal in key soybean areas and higher acreage compared to last two years, the prices are likely to remain subdued”, said Raju Choksi, Vice-President (Agro Commodities), Anil Nutrients Ltd.
The price could well drop below Rs. 28,000 per tonne on ex-Indore basis, he said in a statement.
As per the Association data, soymeal exports during the April-June 2013 period fell by almost 36% at 4.1 lakh tonnes as against 6.37 lakh tonnes in the corresponding period of last year. Exports to Iran fell by around 13% during the above period, he said.
According to the fourth advanced estimates released by the Government on Monday, the soybean crop size was 146.8 lakh tonnes in 2012-13 as against 122.14 lakh tonnes in 2011-12. “With higher acreage this year, we believe the crop size could well be close to 160 lakh tonnes or around 10% higher than last year. This would put pressure on prices in 2013-14, if exports do not pick up as they did in the last quarter of 2012-13, said Choksi.
Soymeal for the new season is being traded at $455/MT FAS Kandla basis, for delivery during November/December. This is against USD 545/MT FAS Kandla for ready delivery.