India soymeal exports could hit 4-yr low on faltering Iran demand-trade
* Soymeal prices jump due to lower soybean output
* Top buyer Iran nearly stops buying Indian soymeal
* Soymeal exports could fall to 500,000 T to 600,000 T
By Rajendra Jadhav
MUMBAI, Dec 12 (Reuters) - India's soymeal exports in 2019/20 could plunge to their lowest in four years due to faltering demand from top buyer Iran and as a rally in local soybean prices make shipments pricey for overseas buyers, industry officials said.
Lower exports from India will help major growers like the United States, Argentina and Brazil increase sales of the animal feed to Asian buyers like Bangladesh, Vietnam and Japan.
"Iran is not buying. For other buyers, cheaper alternatives are available," Manoj Agrawal, managing director at exporter Maharashtra Oil Extractions Pvt Ltd told Reuters.
India's soymeal sales to Iran surged earlier this year as the oil producer used the rupees it receives for its crude oil exports to cover its animal feed demand amid U.S. sanctions that have crimped its ability to import necessities.
But Iran has nearly stopped buying Indian soymeal lately and for other Asian buyers such as Bangladesh and Vietnam, Indian shipments are very expensive, Agrawal said.
Soymeal prices in India have risen over 31% so far in 2019 to $480 per tonne on a free-on-board (FOB) basis following a rally in local soybean prices. Global soymeal prices fell nearly 5% over the same period to $293 a tonne.
India's soymeal exports could fall to 500,000 tonnes to 600,000 million tonnes in the 2019/20 marketing year started on Oct. 1, down from 2.2 million tonnes a year ago, three dealers with global trading firms told Reuters.
Iran bought 517,017 tonnes of Indian soymeal last year, according to data compiled by the Soybean Processors Association of India (SOPA).
"Export demand is negligible right now. Asian buyers are giving preference to South American supplies," said Davish Jain, chairman of SOPA.
Indian meal once accounted for nearly a quarter of Southeast Asian imports, but its share has been falling due to rising local soybean consumption and stagnant production.
India has a very limited surplus for exports this year due to a drop in soybean output, said B.V. Mehta, executive director of the Solvent Extractors’ Association, a trade body.
New Delhi could have a surplus of 1 million tonnes of soymeal for exports, the SOPA estimated earlier this month, anticipating soybean production of 9 million tonnes.
But industry officials including the SEA's Mehta say soybean production may have fallen to between 8-8.5 million tonnes from last year's 10.3 million tonnes.
"As supplies are limited, prices will remain high and exports would remain uncompetitive even in coming months," Agrawal said.
(Reporting by Rajendra Jadhav Editing by Nick Tattersall)
