India is increasingly finding itself being edged out of the international market for the export of oilmeals. The country’s overall export of oilmeals from April to November 2015 has reduced by 38%. The export of soybean meal is at a historic low during the current year. Exports of 55,889 tonne was reported during the first eight months of the financial year 2015-16, compared to 250,904 tonne in the previous year.
The latest report of the Solvent Extractors Association of India (SEAI) says that the overall export of oilmeals during April-November 2015 has reduced by 38% compared to last year, at 895,646 tonne, compared with 1,452,105 tonne during the same period last year and 2,602,966 tonne for the period April-November 2013. According to B V Mehta, executive director, SEAI, there has been a glut of soybean production in the international markets and the Indian cost is much higher than Brazil or Argentina.
“We are being outpriced in the international markets and are losing out on existing markets,” he said. “Iran, which was a major buyer, due to sanctions would purchase 1 million tonne (MT) of soymeal. Now, Iran purchases from Argentina or Brazil. Vietnam, another major market, has set up a new plant and therefore imports soybean for crushing. Also, Japan, which used to import non-GM varieties, has now begun importing GM. As a result, India is losing markets,” Mehta. Also, Pakistan and Bangladesh import soybean instead of soymeal, for crushing. The export of oilmeals for November 2015 was reported at 112,081 tonne compared with 189,032 tonne during the same period last year, down 41%.
The high price of soybean in the domestic market and lower realisation for meal and oil has resulted in the fall in crushing and export of Soybean meal. Soybean crushing has been reduced due to the continuous disparity and high price of the domestic market, affecting overall domestic availability of both oils and meals. Similarly, rapeseed meal export has also reduced to 1/3rd of last year.
Capacity utilisation is at the lowest, says the report. Industry is passing through a very tough time and many plants are shut down or operating at very low capacity due to disparity in crushing and export, the report says. The reasons for the decline include the high price of soybean in domestic market versus lower realisation for meal and oil resulted in to drastic fall in crushing and export of soybean meal. Also, exports to Japan, Iran, Thailand, Indonesia, Taiwan and Vietnam drastically reduced due to the disparity in export in these regions against severe competition from other origins, including China and Argentina. Thirdly, India lost the Vietnam market for soybean meal due to stiff competition from other origins and increased availability from domestic crushing of imported soybean.
