India’s soymeal exports are likely to rise in coming months as concerns over soybean output in top producer Brazil lifts global prices to two-month highs, prompting buyers to turn to the south Asian country, industry officials said.
The revival in the exports of the animal feed could boost soybean crushing in India and the availability of soyoil, which could reduce imports of soyoil and palm oil by the world’s biggest buyer in coming months.
Indian soymeal has become attractive because of the rally in U.S. soymeal prices, Hemant Jain, an exporter in Indore in the central state of Madhya Pradesh told Reuters.
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“Until last month only Bangladesh, Iran and Nepal were making purchases. Now even Vietnam and other Asian countries have started making inquiries.”
U.S. soymeal futures jumped 20% in five weeks as erratic weather has caused problems in the world’s No. 1 exporter Brazil.
Indian traders have contracted to export around 300,000 metric tons of soymeal for shipments in November and December, mostly to Bangladesh, Iran, Nepal and Vietnam, traders said.
Anticipating export demand, soybean and soymeal prices in India surged in the last week, making exports less competitive, said Manoj Agrawal, managing director of Maharashtra Oil Extractions.
“There is an opportunity to export a good amount of soymeal in the next three months, but to make that happen, Indian prices need to remain on par with global prices,” Agrawal said.
While soymeal prices have improved, soyoil prices are under pressure because of record inventories of imported soyoil, effectively reducing soybean crushing margins, said a New-Delhi based dealer with a global trade house.
“Soybean crushing is on the rise, and there’s a good demand for exports and from the local poultry industry. This will beef up our domestic soyoil supplies and put a cap on imports,” he said.
Source: Reuters (Reporting by Rajendra Jadhav; Editing by Kim Coghill)