Overseas soymeal order delays may hit export target

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Nov 20 : South Korea, Indonesia and other buyers of soybean meal are delaying purchases because of a collapse in trade financing, thwarting India’s plans, Asia’s biggest exporter, to boost shipments to a record. “Indian exporters are selling soybean meal, used in livestock feed, at about $270 a metric ton, 48% less than at the start of October,” said Rajesh Agrawal, a spokesman of the Soybean Processors Association of India, said.

Importers of meal in Asian countries including Vietnam are struggling to secure trade credit as banks hoard capital. Indian shipments may total 5 million tonne in the year from October 1, less than the 6 million tonne forecast by the industry in September. “People are buying to fill immediate requirements and not for future needs,” said Davish Jain, chairman of the Central Organisation for Oil Industry and Trade, the biggest edible oil processor group.

India’s exports of soybean meal fell 47% in October from a year earlier to 88,723 tonne, according to the Solvent Extractors Association of India. Shipments of oilseed meal, including from soybeans, declined 43% to 149,326 tonne.

Soybean meal for December delivery dropped as much as 2.5% to $261.10 a ton on Thursday on the Chicago Board of Trade. Futures have dropped 41% from the peak of $445 recorded on July 3 . “As prices of feed grain and soybean meal have been falling, there is no need to rush for purchasing them,” said Kim Chi Young, director, Korea Feed Association, India’s biggest feed-grain importer.

Commodities markets are heading for the biggest annual drop in more than 25 years as the US, the UK, Japan, Germany and the 15 European nations that use the euro, slip into a recession. The slump and weak demand has forced buyers in countries including China, India and Indonesia to default on purchases of commodities from rubber and palm oil to coffee and soybeans, and seek shipment delays by as much as two months.

“Demand has slowed from all the countries we sell to,” said Agrawal.