Soymeal traders see exports surging 70% on Chinese demand, weak rupee

India's soymeal exports in 2018/19 could jump as much as 70 per cent from a year ago, buoyed by expected purchases from the world's biggest soybean buyer China, industry officials told Reuters on Thursday.

A depreciation in the rupee and a jump in soybean output will help India gain market share in China, which is looking for new suppliers after imposing tariffs on key US farm commodities as part of a Sino-US trade row, they said.

"China's market is huge. It is likely to open for India in the next two-three months," said Davish Jain, chairman of the Soybean Processors Association of India (SOPA).

The additional demand could lift the south Asian country's soymeal exports in the new marketing season starting from October to 2.5 million tonnes to 3 million tonnes from this year's 1.75 million tonnes, he said.

Bangladesh, Vietnam and Japan are the key traditional buyers of Indian soymeal.

Traders have so far signed contracts to export 300,000 tonnes of the new season crop to Europe, Japan and Vietnam for shipments in November and December, two dealers with global trading firms said on the sidelines of the Globoil India conference.

"Falling rupee is helping exporters. Most of the contracts were signed around $370 per tonne on a free-on-board (FOB)," said Ravi Agrawal, director at exporter Maharashtra Oil Extractions Pvt Ltd.

India's rupee has depreciated nearly 12 per cent so far in 2018, making purchases more attractive for overseas buyers.

A government export incentive will also help India export surplus soymeal this year, said SOPA's Jain.

In July, India raised the incentive for soymeal exports to 10 per cent of the shipment value from 7 per cent.

India's soybean output could jump by 20.5 per cent in 2018 to 10 million tonnes as farmers expand cultivation of the oilseed, said Govindbhai Patel, managing director of trading firm G G Patel & Nikhil Research Company. The forecast depended on good weather, he added.

Last week, New Delhi also urged China to drop a ban on its rapeseed meal imports at a meeting with government officials and feedmakers in a meeting held at India's embassy in Beijing.