Oilmeal exports dip 63% on high global prices

India’s oilmeal exports declined a staggering 63.75 per cent due to higher global prices and poor availability in the domestic market.

According to the data compiled by Mumbai-based Solvent Extractors Association of India (SEA), total exports slumped to 178,000 tonnes during May this year, as compared to 492,000 tonnes during the corresponding month a year ago.

The country’s poor performance in the export market was also attributed to lower availability of soybean for crushing.

Analysts said that farmers held their stocks in anticipation of higher prices. Since soybean prices continue to remain under pressure and moreover, sowing for the current season is expected to turn favourable, farmers have started releasing their stocks gradually.

BV Mehta, executive director of SEA believes that India’s meal shipment will gain momentum in coming months again.

Meanwhile, overall exports of oilmeals nosedived 63.38 per cent at 417,000 tonnes during the first two months of the current financial year as compared to 1.14 million tonnes in the same period last year.

Since January 2009, export of oilmeals is declining continuously due to steady decrease in the production of meat and partly due to reduction demand for compound feeds and thus for oilmeals.

Several Asian countries have suffered from a crisis in the livestock industry, which has contributed to lower consumption of soymeal and other oilmeals, reflecting in lower export from India.

Total shipment almost halved at 1.77 million tonnes so far this calendar year from 3.6 million tonnes in the corresponding period last year.

World production of soymeal is expected to fall by 6.8 million tonnes or 4 per cent in 2008-09.

The tightness in soymeal supplies is the major bullish factor for oilmeals.

The disastrous soybean production in Argentina, only at 32.7 million tonnes, from last year’s 46.2 million tonnes, coupled with lesser production of soybean in Brazil, Paraguagy and other South American countries, will have major consequence for the remainder of the season as well as for the first half of the world crop season (2009-10).

Soybean crop failure in South America and resulting sharp decline in world supplies of soybean by 22 million tonnes during current season, production of soybean and other oilmeals could not be increased sufficiently as a result price of soybean and other oilmeals have firmed up since January 2009.