MUMBAI May 23 India's oilseeds industry body
has cut its soymeal export forecast by 25 percent from its
previous outlook as an appreciating rupee and a correction in
global prices make Indian supplies uncompetitive.
India may export 1.5 million tonnes of soymeal during the
2016/17 marketing year that runs from October to September, said
B.V. Mehta, executive director of a Mumbai-based trade body
Solvent Extractors' Association (SEA).
Lower shipments from India will help South American
countries like Brazil and Argentina to increase soymeal sales to
Asian buyers like Vietnam, Thailand, Japan and Indonesia.
Soymeal is typically used as animal feed.
It will also prompt farmers to cut soybean cultivation and
shift to other crops like cotton in the upcoming sowing season.
"We are out-priced right now due to strengthening rupee,"
said Mehta. "At the same time global prices are coming down due
to weakening of Brazilian real."
India's rupee has strengthened more than 5 percent so
far in 2017, while the Brazilian real fell 4 percent last
Soymeal prices in India have risen nearly 10 percent in the
past three months to $390 per tonne on a free-on-board (FOB)
basis, while global prices dropped 8 percent to $307
during the same period.
At the beginning of the season, the SEA was expecting
shipments of 2 million tonnes during the 2016/17 marketing year
because of higher soybean output.
India may produce 10.6 million tonnes of soybeans in
2016/17, up 47 percent from a year ago, said the SEA.
"Mills are not getting new export orders due to price
disparity," said D. N. Pathak, executive director of the Soybean
Processors Association of India (SOPA).
The country's exports fell to 111,800 tonnes in April from
180,884 tonnes in March, according to data compiled by SOPA.
The slowdown in exports has pulled local soybean prices
to the lowest level in more than five years, which could
prompt farmers to shift to other crops in the next season,
industry officials said.
"I recovered mere production cost this year from soybean
planting. In the coming season I am planning to shift to
cotton," said a Mahesh Suryawanshi, a farmer from the western
state of Maharashtra, a leading soybean producer in India.
Indian farmers start the sowing of summer-sown crops in June
with arrival of monsoon, which is expected to deliver normal
rainfall this year.
(Reporting by Rajendra Jadhav; Editing by Christian