Monthly Prices Movement

  • Soybean prices traded mixed in the major markets across the country with more of negative sentiments as higher production is expected in the current season. Soybean will arrive the markets by September.

  • Soybean Meal prices in overseas turned lower during the month making Indian Meal uncompetitive in the international market due to wide price difference.

  • Mustard Seed prices in the major markets so far in this month were largely pressured by slow demand for Mustard Oil and weakness in other Vegetable Oils.

Ground Report

  • India's Kharif Oilseed crop prospects have brightened significantly following good rainfall, setting the stage for higher productivity from crops, which have already been planted in a bigger area than last year.

  • India's total Oilseed acreage has increased and reached 17.774 million hectares as of 26 August 2016 in the current Kharif season, according to Agriculture ministry.

  • India’s Soybean acreage increased in the season whereas fall was reported in the Groundnut, Sunflower and Castor Seed acreage.

  • Soybean acreage of the country increased to 11.208 million hectares as of 26 August 2016 while Groundnut and Castor Seed acreages fell to 4.384 million hectares and 0.577 million hectares respectively.

  • SEA stated that India's Oil Meal export during July month rose 99% at 87,944 tonnes. But overall export of Oil Meals during April to July 2016 was in negative trajectory of 47%. Mustard Meal exports from India in July sharply dropped by 90.38% to 4197 tonnes compared to the previous month.

  • India's Soy Meal exports for July reported higher by 23.13% M/M whereas Castor Meal exports increased by 94.03% compared to last month.

  • SOPA estimates that India may produce 9-10 million tonnes of Soybean this year following good sowing and better weather condition so far. India's Soybean arrivals reached 5.45 million tons during the first ten month of the current season.

  • According to SOPA estimates, India has produced around 6.93 million tons Soybean during season 2015-16, while opening stocks were estimated at 0.62 million tons.

  • India used 5.1 million tons of Soybean for crushing to obtains Soybean Oil and Soybean Meal from the imported 5045 million tons, SEA said.

  • Soybean area in Indian state of Madhya Pradesh decreased by about 9.2% over last year and has shifted to Urad, Maize, Red Gram, Sorghum and Paddy. But the total area has been maintained due to higher acreage in Gujarat, Maharashtra, Telangana and Karnataka.

  • Groundnut seed sowing of India is up 26% this year at 4.38 million hectares.

  • As per the agriculture department of India, total sowing of Castor Seed as on August 26 has reached to 577000 hectares, down by 24.37% compared to same period last year.

  • Castor Seed sowing of India may decline by 25 to 40% in the year 2016-17 as farmers shift further in favour of Groundnut and Pulses. Castor sowing so far in India declined by 15%.

  • Sowing of Castor Seed in Gujarat, which accounts for over 80% of India's Castor seed production, has reached 400,700 hectares as on August 30, 2016, down 35.1% year-on-year.

  • Mustard Seed output in Rajasthan, the largest producer, is seen at 2.6 MT this year compared with 2.2 MT last year.

Policies

  • India increased the import tariff value for Crude Soybean Oil to $775 per ton for the second half of August against $771 a ton earlier.

  • Chinese government demanded Canada to reduce the amount of organic waste materials in Canola seed shipments, also known as dockage to 1% from September 1st, which is lower than the industry standard of 2.5%.

  • Argentina government eliminated the Corn export taxes which have made the growers shift to corn from Soybean.

  • Soybean Processors Association of India (SOPA) has urged the Indian government to increase duty on imported Crude Soybean Oil to 37.5% and 45% on Refined Soybean Oil, which is the WTO bound rate.

Global

  • USDA projects India's Soybean production in the current season at 11.4 million tonne. India's Soy Meal export estimate revised down by 1 lakh tonne to 1.7 million tonne.

  • International Grains Council projects global Soybean production for 2016/17 at 325 million tons, an increase of 3% year-on-year.

  • USDA hiked global Rapeseed output forecast to 67.16 million tons in the current season.

  • Global Mustard Seed production is likely to fall to 5-year low at 61.7 million tonnes this year, largely due to declining interest in sowing and disease problems.

  • Global import demand for Soybean is anticipated to rise further to a high of 136 million tons, on expanded deliveries to China.

  • Argentina Soybean crushing during the first seven months of the year totalled 26.4 million tonnes, increased 13.3% from a year earlier, as per government data.

  • China's Rapeseed imports climbed 68.7% from a year earlier to 341000 tonnes in July, according to data from General Administration of Customs.

  • Rapeseed imports of China during the first six month of the year declined 8.2% to 2.335 million tonnes, as per customs data.

  • US Soy Meal exports fell to 579,417 tons in July from 594,710 tons in June, according to National Oilseed Processors Association (NOPA) and Soy Oil stocks of US as of July 31 stood at 1.743 billion lbs.

  • USDA pegged domestic Soybean production at a record level of 4.06 billion bushels in 2016.

  • USDA boosted its 2016/17 Soybean export forecast for US by 30 million bushels to 1.95 billion.

  • The 2015-16 Soybean harvest in Brazil is expected to decline by 0.8% to 95.4 million tons from 96.2 million tons recorded for the previous season, according to Conab.

  • Conab report shows, Brazil's Soybean planted area increased 3.6% from 32.1 million hectares a year earlier to 33.2 million in the current crop.

  • China's Soybean imports in July fell by 18 percent to 7.76 million tonnes according to customs data.

  • Brazil Soybean exports fell to 5.78 million tonnes July, a fall of 31.4%, according to government data.

  • Brazil's grain crushing industry association ABIOVE lowered its estimate for the 2015-16 Soybean production to 96.6 million tonnes and Soybean exports to 53 million tonnes during the February-January commercial year.

  • Canola production of Canada is to fall by 1.2% to 17 million tonnes due to extremely dry and wet weather conditions in different parts of the country, as per Statistics Canada.

Outlook

  • Mustard Seed prices so far in this month was highly pressurized by slow demand in Mustard Oil. Mustard Oil usually consumed in large quantity for cooking non veg food item by Indian households. Since Shravan is considered as holy month, the consumption of non-veg food items decline resulting lower use of Mustard Oil.

  • Mustard Seed prices will continue to focus on demand for Mustard Oil, which is likely to pickup in coming days once festival season starts. Mustard Meal exports declined by 90% in July and it is also negative for prices of raw material, as the same has also impacted demand and crushing for Mustard Seed.

  • Mustard Seed prices in long-term likely to stay positive, but with volatility as balance stock is depleting which will support prices, whereas good monsoon this year so far may prompt early sowing. Timely sowing of crop may result in better yield.

  • Soybean Meal demand in local market continued to remain irregular as poultry farms are buying are per requirement, expecting prices to fall in new season on expectation of better than expected crop.

  • Soybean prices on the international markets are also under pressure as improving US crop ratings fueled expectations for a bumper harvest influenced Soybean prices. India's Soybean output set to rise this year after good early Monsoon rains prompted farmers to plant more of the Oilseed in June and July, helping the world's top Vegetable Oil importer cut overseas purchases of the cooking ingredient.

  • Soybean prices are likely to dip by 8-10% in the next one month or so on higher production estimates this Kharif. Soybean market largely depended on demand for Soy Meal as the other by-products Refined Soy Oil is imported in large quantity to meet domestic demand.

  • Soybean crop is in final stage of development where monsoon will play a major role. September rain will be very crucial for Soybean crops as if rain falls again resulting local flooding or water logging, then crop will get severely affect.

  • As prospects brighten for a good Soybean harvest this year, aided by normal monsoon, the Oilseed processors asked the Center to curb the inflow of cheap oils into the country to protect both the growers and processing industry in the months ahead.

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