Local demand, world glut hit Indian soyameal exports

Soyameal sales by India, Asia's leading exporter, are expected to remain subdued this year because of high prices driven by robust domestic demand and a big global crop, traders said on Thursday. The country, which mainly sells to Southeast Asia, has contracts to ship around 400,000 to 500,000 tonnes of soyameal so far this crop year which begins in October, about half of its normal exports during this period.
"Our meal sales are taking a beating. There is absolutely no trade," Atoll Chaturvedi, vice president of Aden Exports Ltd, told Reuters. Traders estimated domestic consumption of soyameal this year would grow by 30 percent to 1.8 million tonnes.
"This year, bean prices have been up because the local poultry industry is doing very well," Chaturvedi said. India grows only one soyabean crop a year, for which sowing takes place in June and July and harvesting begins in September.
The Central Organisation for Oil Industry and Trade, a top trade body, has said India was likely to produce 6.6 million tonnes of soyabean compared with 6.85 million last year because of erratic monsoon rains.
Traders said Indian bean prices have increased to 13,600 rupees ($308) a tonne from 11,800 rupees a tonne at the beginning of the season in October, despite a big global crop. "Farmers are finding buyers even at high prices because our bean market is not in line with the global trend," one Bombay-based dealer said.
Traders said Indian soyameal was quoted $10 to $15 higher than global price levels of around $245 cost & freight at Southeast Asian ports. Traders expect India to sell about 2.2 million tonnes of soyameal in this season compared with 3.5 million tonnes exported a year ago.
Indian soyameal was sold at prices close to $400 last year due to a supply shortfall from South America and the United States. But this year, global soyameal prices are under pressure on expectations the United States will produce a record crop.
Indian traders had expected good sales in December, but their hopes were dashed as domestic soyabean prices rose and global meal fell. CBOT soyameal futures for December delivery fell from the recent high of $162.80 per tonne on November 23 to close on Tuesday at $154.20 per tonne.
Traders said India's poultry industry could not consume all the meal in the market. "Whatever is excess has to go out. Ultimately the bean prices have to come down but one can't say when," said Rajesh Agrawal, chairman of Indoor-based Soyabean Processors' Association of India.