India, encouraged by competitive prices, is negotiating for fresh soymeal sales to China after its giant South Asian neighbour made its first purchases of the season last week, traders said on Tuesday.
Dealers in Singapore said China has agreed to import about 40,000 tonnes of soymeal from India at around $235 a tonne cost and freight for November shipment.
Indian traders said while there was no firm confirmation of the Chinese purchases yet, fresh enquiries by firms were continuing with top exporters to meet meal demand in China.
"There is no smoke without fire," said a leading soymeal exporter based in Indore, the hub of the country's soybean trade.
"Surely some cargoes have been traded and beyond that talks are on for a couple of more cargoes for November and December delivery," said an industry official from Indore.
Asian markets have been talking since last month about the possibility of China importing Indian soymeal to meet a protein shortage, following a slowdown in soybean imports.
Dealers said this week they were cautious about rushing into deals for Indian soymeal sales to China because of concern Beijing might discourage imports in order to protect its crushing industry.
The exporter from Indore said more soymeal deals were possible as domestic soybean prices had softened, making Indian meal competitive.
Traders said Indian soymeal was now being traded at $230-$235 per tonne levels, cost and freight, compared with $245-$250 when the season began in August.
They said local soybean prices had fallen to 12,000-12,500 rupees ($262-$273) a tonne from 18,000 rupees in August.
India's soymeal exports this year are expected to fall to about 3 million tonnes from 3.45 million in the previous year on rising domestic consumption.
Domestic soybean output is estimated to rise to 7.2 million tonnes in 2004/05 (October-September) from 6.94 million a year ago.
But another trader with an international firm was sceptical about big soymeal sales to China.
"Exporters are also wary of the risk involved in sales to China.