Mumbai (Commodities Control) – NCDEX Soybean Dec 20 futures today fell by 60 Rs to settle at 4350 Rs/qtl.
Lower demand by plants, profit booking by stockist has led to fall in soybean futures.
Soybean prices came under pressure today after Indian govt announced reduction in import duty on crude palm oil by 10% to control rising veg oils prices.
Palm oil compromises of 60% of total edible oil import by India. Recent rise in prices had raised eyebrow and putting food inflation in high risk.
By reduction in import duty the govt has achieved the lower prices in domestic market but it is highly unlikely to sustain.
Primary reason the market for veg oil went up was due to sharp shortage in soft oil and palm oil stocks alike.
Reduction in duty might give respite for short term but eventually spot tightness and short coverage will result in higher prices.
Soybean prices have indirect impact of reduction in duty as it makes local available oil less attractive. However, we expect that market will end
correction soon as it has approached levels which can be considered as bargain buy for soybeans.
NCDEX Soybean futures are likely to hold above 4250/4300 Rs/Qtl on correction and eventually attract buyers to steadily take prices back up again due to strong meal demand.
(Commodities Control Bureau)
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