Soymeal exports may fall in April

Likely to plumment to 2,00,000 tonne, down 71% in a month

The soymeal export from India may plummet to around 2,00,000 tonne in April, down 71 per cent in a month. The reasons are high soybean prices in the open market and low availability of the bean.

Many industry players have blamed the centre for scraping the Target Plus scheme which was provided to the exporters under the Exim policy in April. This forced the exporters to sell soymeal in March itself.

Moreover, the domestic exporters faced tough competition from the influx of Brazilian and Argentinean soymeal in the overseas markets.

In March 2006, India exported around 6,97,763 tonne of soymeal, which was up by 209 per cent.

"Soymeal exports may fall short by 5,00,000 tonne in April owing to less soymeal availability. The reasons being poor stocks with farmers. The open market rate of bean was much higher in comparison to other months," said a senior official of the Soybean Processors' Association of India (SOPA).

Prices of soybean in the open market rose by around Rs 30-40 per 100 kg in April due to poor stocks with farmers and the application of additional 4 per cent value added tax in Madhya Pradesh.

"In April, most exports took place at a low price of $197- $198 per tonne (free alongside ship) as buyers preferred cheap Brazilian meal over Indian soymeal," a SOPA senior official said.Another dealer said, "Many exporters sold huge quantities of soymeal at cheap prices in March due to fears of discontinuation of the Target Plus scheme for exports, which also led to sharp rise in overall exports."

The Target Plus scheme was to provide incentive to exporters on achieving incremental growth.However, the scheme was discontinued in the recent foreign trade policy due to objections raised by the finance ministry.

"We estimated that the domestic meal exports in March would be around 4,50,000 tonne. However, it rose to over 7,00,000 tonne owing to panic selling by the exporters," said the official.

Another official said, "April-August usually form lean periods for domestic soymeal as the crops from South American nations flood the markets."

Industry sources said that Indian soymeal exports would revive around September and November 2006, when the new crop starts reaches the markets.