Soybean prices to correct by January on better quality crop supply

KOLKATA: Soybean prices hover around Rs 4,000 per quintal in the initial part of the season as domestic supply remains erratic. Late rains in Madhya Pradesh, Maharashtra and Rajasthan adversely affected the yields and quality of soybeans leading to short supply of good quality soybeans and consequently spurt in prices.

However, the situation is likely to improve once better quality crop supply improves and short positions of sellers are fulfilled. Soybean production estimates in the country is being scaled back from the initial record levels as the extent of damage is known. Due to lower yield, the output forecast is likely to get revised downwards. Prices of soybean are currently in the range of Rs. 3,950 – 4,050 per quintal across major markets.

Explaining the situation, Mr. Raju Choksi, vice-president (agri commodities), Anil Nutrients Ltd. Said, “Currently, Indian soymeal is being offered at around $550-555 per tonne free alongside vessel, which is quite expensive in international markets. With correction in prices, the exports are likely to rebound as better quality Indian soymeal would again become competitive in the international market,” Mr. Choksi said.

High prices and quality issues have led to a poor rate of crushing of soybean at present affecting soymeal quality and availability which in turn has impacted its export.

Mr. Choksi said that some international traders have switched from India to other origins for fulfilling their commitments. “As the moisture content was higher than stipulated level some of the cargoes faced rejection, thereby resulting in problems in fulfilling export commitments on time,” Mr. Choksi added.