MUMBAI (Commoditiescontrol) - India soybean futures closed this week at 15-month high due to good demand, declining arrivals, increased in prices of refined soy oil and soybean meal.
Spot soybean gained 2.34% at 3,275/100kg at the benchmark Indore market, whereas meal and refined soy oil rose by 2% (Rs 25,000 per tonne) and nearly 1% (Rs 742/10kg) respectively.
Soybean arrivals during this week dropped at 32,300 metric tonnes compared with 45,400 metric tonne same period a month ago.
However soybean arrivals during the current season Oct-Dec 2017 recorded higher at 45 lakh tonnes versus 34 lakh tonnes corresponding period last year due to increased selling in Madhya Pradesh under Bhavantar Bhugtaan Yojana, according to Soybean Processors Association of India (SOPA).
The industry body, SOPA, has estimated 2017-18 (Oct-Sept) crop at 91.46 lakh tonnes, while pegged opening stocks at 13.03 lakh tonnes, which took the total marketable supply at 92.49 lakh tonnes after reducing 12 lakh tonnes as retained by farmers for sowing.
Crush activity was better than last year thanks to strong demand for soybean meal in front of export as well good domestic consumption.
According to The Solvent Extractors' Association of India (SEA), country's soybean meal export jumped up 107% at 447,920 metric tonnes compared with 215,931 metric tonnes a year ago.
"The rise in export demand was attributed to hike in import duty on edible oils by 12.5 to 15% across the board and increased MEIS on soybean meal to 7% from 5%. This steps has made Indian oilmeal more competitive in the world market and may result in to larger export of oilmeals during current year," said Dr. B.V Mehta, Execuctive Director, SOPA.
Domestic soybean meal consumption during December was pegged at 4.50 lakh tonnes, unchanged from a month ago, according to balance sheet drawn by SOPA.
Indian soybean meal is tentatively priced at $423 per tonne CIF Rotterdam vs $363 Argentina CIF Rotterdam (January) as on January 11, 2017. India Soybean meal is now in disparity of $60/MT in international market compared to Argentine soymeal.
Although export of soybean meal so far this season was better than last year, but competitive rates in the international market may weigh on export demand in the upcoming months.
Soybean price may find resistance at the higher level and further rise in prices likely only in case export of soybean meal picks up from current level.
Refined soy oil prices edged higher this week tracking gain in interntational markets and slow imports. Soy oil imports from overseas during the month of December declined sharply at 79,250 metric tonnes against 273,928 metric tonnes in November 2017 due to import duty hike.
India government on November 17 announced to increase import duty on crude soyabean oil to 30% from 17.5%, while refined soyabean oil has been raised to 35% from 20%.
(By Commoditiescontrol Bureau; +91-22-40015533)