Soybean arrivals dip 15% in Oct-Nov on bearish prices, muted meal demand

Market arrivals of soybean are down by about 15 per cent in the first two months of the oil year 2024-25, as growers are holding back their produce, anticipating better prices. Soybean prices have been bearish this harvesting season, trading below the minimum support price (MSP) levels of ₹4,892 per quintal. Presently, the prices are hovering around ₹4,200.

The bearish prices are attributed to the muted demand from both overseas and domestic customers for soymeal, a key by-product derived from the crushing of beans to extract oil. Additionally, higher global supplies of soybeans have kept the prices under pressure.

As per the latest estimates by the Soybean Processors Association of India, the bean arrivals stood at 34 lakh tonnes during October-November, the first two months of the oil year 2024-25, compared to the same period last year’s 40 lakh tonnes. As a result of lower arrivals, the crushing volumes are also lower by 17 per cent, at 19.5 lakh tonnes, compared to the same period last year’s 23.50 lakh tonnes. The stocks with farmers, plants, and traders are estimated to be around 101.29 lakh tonnes.

Soybean production this year is estimated to be higher, at 125.82 lakh tonnes, compared to last year’s 118.74 lakh tonnes. Also, the carryover stocks from the previous year were lower at 8.94 lakh tonnes, down from last year’s corresponding 6.25 lakh tonnes. SOPA estimates soybean imports to decrease by half, to around 3 lakh tonnes during the oil year 2024-25, from last year’s 6.25 lakh tonnes. The lower crushing volumes have led to a 17 per cent decline in soymeal production, at 15.39 lakh tonnes, down from last year’s corresponding 18.54 lakh tonnes.

D N Pathak, Executive Director of SOPA, said the weak demand for soymeal from both domestic and overseas markets is influencing soybean prices. Soymeal exports are down 37 per cent in the first two months of the oil year 2024-25, at 2.41 lakh tonnes, compared to the same period last year’s 3.85 lakh tonnes. Offtake of soymeal from domestic livestock feed makers was 11.50 lakh tonnes, down from 13 lakh tonnes. Offtake from the food sector remained flat at 1.50 lakh tonnes.