Soya exporters strike lucrative deals this season

Biren Vakil

Indian soyameal exporters have kicked off a new export campaign by striking deals for shipments to South Korea, as the country is expected to reap a record soya crop. Banking on the marketing USP of GM-free soyameal and bullishness in the global protein market, Indian exporters are confident of regaining lost markets and even hoping to attract new buyers in the global protein market.

As the new Indian soybean crop enters its flowering stage, regional oilseed traders are closely watching the rain situation in the next couple of weeks, crucial for the crop’s maturity. However, bidding and offer process for Indian soyameal supplies has already started and volume is likely to peak up by the end of this month. According to reports, South Korea, the biggest buyer of Indian soyameal, has already contracted for nearly 30,000 tonnes of meal from India at around $204 a tonne C&F for November shipment. Indian exporters were offering a new crop soyameal at about $190 a tonne FAS (free alongside ship) for November shipment but buyers were only interested at $185 The rainfall spread has so far been good. As the crop is in its pod-setting stage, a few regular but light showers are needed in the next four to five weeks for the crop to turn out in perfect shape,” said one Indian exporter. ‘‘Apart from South Korea, inquires from other south-east Asian countries such as Philippines, Thailand and Indonesia has also started as these traditional buyers prefers Indian soyameal for shipments for November to May because of the competitive freights and availability of smaller cargo.

Freights and big cargo size of Panamax containers is the key disadvantage to USA and South American soya exporters. India is likely to export 27-28 lakh tonnes of soyameal compared with about 22 lakh tonnes in the previous year. About 50 lakh tonnes of soyabean is likely to be crushed this year. Nearly 40 lakh tonnes of soyameal is expected to be available after crushing, out of which around 12 lakh tonnes could be sold in domestic markets and the remainder could be exported, it is expected. Last year Indian soyameal exports dropped to about 2.2 million tonnes from 2.65 million last seasons — were hit by a number of problems. Asian buyers shifted to South American soyameal well in advance this year due to relatively lower prices. An earthquake in Gujarat in January disrupted shipping operations from Kandla port, forcing many buyers to look for alternative sources. However prospects are bright for the new season due to bigger domestic crop and erratic weather in China.

Output was seen higher due to better yield. Despite area under soyabean cultivation haven fallen marginally this year, total output is likely to rise with better yields. The crop area has declined to 56 lakh hectares from 58 lakh hectares in the previous season, according to Soyabean Processors Association of India (SOPA).

The fall is mainly due to a shift by some farmers to other crops in anticipation of better returns, poor showers in areas like Jabalpur and excess rains in Sagar division. These districts account for nearly 70 per cent of India’s soyabean output. The SOPA had earlier projected a 10 to 15 per cent rise in the cultivation area, but lowered the forecast about two weeks ago to three-four per cent. Total soybean output is likely to rise to 57-60 lakh tonnes in the kharif season compared with 52 lakh tonnes in the last year. Traders estimated average soyabean yield in the current year at 1,000-1,100 kg per hectare.

“We need a heavy shower followed by a clear sky for a few days for proper pod-filling of the crop, which is at the flowering stage now,” a leading agricultural scientist said.

(Author is a partner, Paradigm Commodities; the views expressed in the article are personal)