The soybeans are forecast to extend its Bull Run in first week of CY2011 on continued buying supported by strong fundamental factors. Indian traders and investors are likely to continue bean purchases anticipating more meal export enquiries from South East Asian countries. Positive crush margin is attracting crushers to go for aggressive buying from the markets. Harvesting of soy crop is almost ended and most of the quantity has been sold in the market. So, ease in arrival pressure is likely to add bullishness to the market. India’s soy meal exports have been rising month-on-month basis for last five months indicating robust export demand. Moreover, at-par price of Indian soy meal compares to other origins is also one of the reasons for rise in export of soy meal. According to the Solvent Extractors’ Association of India, India exported 1.7 million tons of soy meal during April to November, higher by 46% Y/Y. We expect meal export in FY11 may be at record level. For FY11, meal export from India is projected at 3.4 million tons against 2.1 million tons in FY10. Apart from domestic factors, Indian market is likely to take support from the global market. Crop loss concern in Argentina due to hot and dry weather condition will be an advantage for India for exporting meal in Asian continent. In December month World Agriculture Supply and Demand Estimate, USDA has projected Argentina soy crop at 52 million tons against 54.5 million tons produced last year. As on 30th December 2010, about 81% of soybean planting has been done in Argentina. However, the crop is requiring good showers for proper growth of the crop. This factor is likely to push up the world oil and oilseeds prices. |
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