India soybean, soyoil down on sowing, Malaysian palm

MUMBAI, July 2 (Reuters) - Indian soybean and soyoil futures ended down on Thursday as farmers in top producing states began sowing and the process is likely to pick up in coming days, analysts, traders and an official in a leading trade body said.

A sharp fall in Malaysian palm oil prices also weighed on the markets. Palm oil and soyoil compete as edible oil and their prices often move in tandem.

Malaysian palm futures dropped 3.7 percent to the lowest level in nine trading days on Thursday as investors focused on weak demand after crude oil tumbled, traders said. [ID:nJAK506311]

Soybean sowing has begun in central state of Madhya Pradesh and western state of Maharashtra, country's top two producers, after rains early this week.

"The sowing has started but is yet to gather momentum... The rains have been widespread, though scanty," Uday S. Kamat, an oilseed crusher in Nagpur in Vidharbha region of Maharashtra, said.

Large-scale sowing may push up supplies and subdue prices.

In 2008/09 crop year the two states accounted for nearly 85 percent of total soybean area of about 9.62 million hectare.

As per latest forecast by the weather department, rains are expected in most parts of central and western India, a key soybean growing region.

"Some sowing has started in Madhya Pradesh," an official in the Soybean Processors' Association said.