Soyabean futures prices on the National Commodity & Derivatives Exchange of India (NCDEX) may remain weak over the next few days on account of higher production estimates amidst favorable weather in major growing areas.
NCDEX Soyabean October contracts prices fell sharply 14% to settle at Rs 2,034.50 per quintal on Wednesday over the past one and half months on account of higher production estimates of soybean in Madhya Pradesh.
“Fresh arrivals of new crop in Madhya Pradesh have provided support to bears in the market,” a local trader said. Madhya Pradesh is a major soyabean producing state in the country.
According to a government estimate, total area sown under soybean has increased to 95.39 lakh hectare in 2008, up 9% from 87.26 lakh hectare in 2007. Total kharif oilseeds sowing acreage also increased to 174.62 lakh hectare in 2008, up 2.31% from 170.67 lakh hectare last year.
“Sharp fall in crude oil also generated selling pressure in soya complex on bio-diesel concerned. Indian soya meal demand is expected to remain sluggish in the coming season amid higher prices of Indian soya meal,” an analyst with Angel broking said.
In the coming week, NCDEX October Soyabean futures are expected to move downward with the strong support of Rs 1,970/1,900 and resistance of Rs 2,160/2,235 levels, analyst said. The country is nearing its harvest season for soyabean; the prices prevailing in the market are quite high for the commodity.
Considering the efforts of government to control edible oil prices, with soyabean at phenomenal rates millers would not be in a position to crush beans at these rates.