Soybean-meal exports from India, Asia’s largest shipper of the poultry feed, may plunge this year to the lowest level in more than two decades as importers from Iran to Vietnam switch to cheaper supplies from South America.
Sales are set to drop as much as 29 per cent to 1.5 million metric tons in the year that began on 1 October 1 from 2.1 million tons a year earlier, according to Davish Jain, chairman of the Soybean Processors Association of India. That would be the lowest since at least 1992-1993, according to group data.
Supplies from India cost more than global rates after benchmark meal futures traded in Chicago dropped 30 per cent in the past year on record global harvests. Iran is buying less because an easing of international sanctions means it can get supplies from Brazil and Argentina, Jain said. The government support price in India is above the world market and farmers haven’t been selling beans for processing, he said.
“India is totally out-priced and the world is really not looking at India as a regular or genuine supplier now,” Atul Chaturvedi, chief executive officer of Adani Wilmar Ltd., said in a phone interview March 26. “The farmers are not releasing the beans in the market in the hope of better prices.”
Sales from India plunged 71 per cent to 502,958 tons in the five months through February from a year earlier as importers turned to Brazil, Argentina and the US, Jain said. Shipments to Iran, the top buyer in the previous year, fell to 184,800 tons from 510,535 tons, data from the group show.
India has shipped soybean meal mainly to Iran, France, Indonesia and Myanmar this year for use in poultry feed, according to B.V. Mehta, executive director at the Solvent Extractors Association of India.
Farmers “made money by holding onto the beans in the last few years,” Chaturvedi said. “This year the world is awash in beans, so I don’t think history will probably help them out.”
Bloomberg News, edited by ESM
