NEW DELHI (Commoditiescontrol) - Soybean prices remained slightly firm at the benchmark Indore market during the week ended November 23 due to improved offtake, fall in arrivals and tracking an uptrend in futures trade.
Spot soybean moved higher by Rs 25-50 to Rs 3,250-3,275/100kg. Similarly, soybean for plant delivery escalated by Rs 25 to Rs 3,450/100kg. Soymeal also gained by Rs 200 to Rs 27,700 per tonne. While, refined soy oil edged lower by Rs 10 to Rs 740/10kg due to tepid buying and adequate stocks in domestic markets.
Demand for soybean from crushers was decent amid positive crush margin followed by good enquiries for soymeal from domestic poultry feed manufacturers. However, export demand continued to remain normal, said a trader from Indore. He further said that the plants are now active in buying soybean, but at lower levels, however sellers are not aggressive.
Soybean prices are likely to remain positive in the days to come on the back of good buying by stockists and crushers amid optimism of better soymeal exports this season and fall in arrivals ahead. However, the main concerning factor is an increasing price of domestic soymeal in the international market, which could restrict overseas demand.
Soymeal export has been mainly affected by the increasing disparity with rival Argentine amid higher soybean price at domestic level and sustained recovery in Indian rupee over the last few trading sessions. Indian soymeal spread has increased to around USD 55 per tonne (CNF-Rotterdam) to Argentine origin.
Further sluggish tone in soy oil is also an important factor need to be watched out.
Meanwhile, farmers are not very keen to sell their crop at lower levels as they are positive about future and thus selling their produce gradually, a trader noted. Supply of soybean will decline in case prices correct further as prevailing spot rates are lower than MSP of Rs 3,399/100kg.
Although farmers in Madhya Pradesh are assured to receive MSP rate with additional bonus of Rs 500/100kg, but the same benefit is not available to the farmers in Maharashtra with the government agencies are procuring at MSP. The pace of government procurement in Maharashtra is also said to be very slow, according to traders.
At the National Commodity and Derivatives Exchange (NCDEX), the benchmark December futures moved higher by Rs 126 to Rs 3,424 per quintal as compared to Rs 3,398 per quintal on last Friday, November 16.
Globally, the most active soybean contract for January delivery on Chicago Board of Trade (CBOT) slipped two cents to close at USD 8.81 a bushel on Friday. Pressuring soy prices was uncertainty about the potential for the US and China to make progress to resolve a trade war at the upcoming G20 leaders’ summit in Buenos Aires.
China is the world’s largest soybean importer, and the oilseed is the largest US agricultural export to the Asian country. However, retaliatory Chinese tariffs against US soybean have stalled trade, threatening to leave a bumper US harvest piled up in storage or rotting in fields.
Trump has imposed tariffs on USD 250 billion of Chinese imports to force concessions from Beijing on a list of demands that would change the terms of trade between the two countries (all figures USD). China has responded with import tariffs on US goods, including soybeans. US soybean shipments to China have dried up in recent months after Beijing raised tariffs as part of the trade dispute between the world’s two biggest economies.
China has been buying Brazilian soybean during the trade war and may be able to continue avoiding US soy due to an early harvest in South America.
Brazilian soybean farmers in the key state of Mato Grosso may start harvesting their next crop before the end of December, agribusiness consultancy AgRural said.
Meanwhile, US soybean export sales of 680,500 tonnes for the week ended Nov. 15 were in line with estimates for 550,000 to 850,000 tonnes. The sales included cancellations of 66,000 tonnes to China and cancellations of 290,200 tonnes to unknown destinations, according to USDA data.
(By Commoditiescontrol Bureau)
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