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Soybean Meal - No takers except Bangladesh

posted Feb 28, 2010, 12:05 AM by NAVYUG Info   [ updated Feb 28, 2010, 7:06 AM ]
Soybean Meal, one of the most traded commodities in the world had seem some aggressive correction over the past couple of months on reports of strong crops in South America and lessened demand from China. 
The Indian millers in tune with the world market had reduced the prices from a peak of Rs 23000/MT ex Factory to Rs 17400/MT ex Factory. But even after this huge correction, wheres the demand? On average, India exports roughly 12lakhs tonnes of soymeal per month. So from November to February India should have exported roughly 48lakhs tonne of soymeal, but only 8lakhs tonne were really exported. The demand from China and South East Asian neighbors have been virtually non existent. I belive this is primarily due to two reasons, first overseas buyers expect further price correction and second, the buyers have shifted to substitute products like rice bran extraction, maize, etc. 
However in the midst of it all, Bangladesh has been taking soymeal like anything. From December till February they have imported around 2 lakh tonnes of Indain Soymeal alone, and the hunger still remains. This is the only thing, that we believe is supporting the soymeal prices in India from going further down. But with the south american harvesting already started and quotation at $320 fob, further pressure is likely on soymeal to match international prices. Watch out, this may turn Bangladesh more hungry.