Monthly Prices Movement

  • Oilseed complex witnessed a mixed trend in the major markets across the country during the month.

  • Soybean prices traded mostly lower in most of the market of the country due to good supply, better crop prospects and slow demand from processing plants.

  • Mustard Seed prices have been pressurized as crushers are buying Mustard Seed mostly in limited quantity at present due to poor demand in Mustard Oil and Mustard Cake.

Ground Report

  • India's Oilseeds production is estimated to climb by 38.63% to an all-time high of 23 million tonnes in the 2016-17 kharif season following a good monsoon, according to agriculture ministry's first advance estimate.

  • India's Oil Meal exports during the month of August dropped 38% at 56,597 tonnes and he overall Oil Meal shipment during April to August slipped 46%.

  • Soybean output of India is estimated to be higher by 65.54% whereas Groundnut output forecast higher by 21.54% in 2016-17.

  • India’s 2016-17 Soybean output is seen increasing to 11.5 million MT from 7 million MT a year earlier under the present conditions, according to USDA Foreign Agricultural Service.

  • The Solvent Extractors’ Association of India has estimated India’s 2016-17 Soybean production to be around 10 million tonnes, up from 7.5 million tonne in 2015-16.

  • Sowing of Castor seed in India fell by 24.7 per cent to 815000 hectares so far as traditionally Castor seed sowing farmers in Gujarat and Rajasthan have diverted to pulses this year, on expectation of better returns.

  • According to SEA, the area under Castor might decline by 40% this year. This could lead to a big price rally this year. India is the largest producer of Castor seed and Castor oil in the world which exports 400,000-450,000 tonnes of the oil every year.

  • US Deaprtment of Agriculture (USDA) forecasts 2016/17 India Groundnut production at 5.5 million metric tonnes due to an increase in estimated area. Acreage is estimated at 5.3 million hectare and yield is forecast at 1.04 tonnes per hectare.

  • SEA reported that India shipped 671.29% higher Mustard Meal in August as against in July while Soy Meal export declined by 47.54% against July.

  • Soybean meal and its other value added products exports from India during August is recorded at just 10,615 tonnes, a negative growth of 66%, according to Soybean Processors Association of India (SOPA).

  • India's Soybean meal exports during the first eleven months of current oil year, which runs from October to September, totalled 2,49,291 tonnes, down 65% from 7,17,682 tonnes last year.

Policies

  • High prices in the domestic market have thrown Indian Oil Meal almost out of the international market. To rectify this, India has started its official lobbying in markets with high potential to export and are sending trade delegations.

  • India slashed the import duty on Crude Palm Oil to 7.5 percent from 12.5 percent, and duty on Refined Palm Oil to 15 percent from 20 percent.

  • China, the world’s largest importer of Soybean, is encouraging farmers in its largest grain province to rotate from Corn to Soybean plantings by offering producers subsidies to make the switch. The provincial government in Heilongjiang is offering farmers subsidies around 2239 Yuan ($335.40) a hectare.

  • China is targeting a 37 percent rise in Soybean planting by 2020, from 2014 levels of 102 million mu, said the National Development and Reform Commission.

  • Argentina is considering postponing a tax cut planned for next year on Soy exports as a recession in Latin America's third largest economy eats into fiscal revenue, as per cabinet chief. Argentina has already lowered taxes on Soy exports to 30 percent from a prior 35 percent.

  • Canada and China have agreed on a solution to a trade dispute over C$2 billion ($1.5 billion) worth of annual Canola sales, lasting to 2020.

Global

  • The US Department of Agriculture (USDA) has pegged global Oilseed production in 2016-17 at 544.5 million tonnes, up 1.0 million from last month's forecast as reduction for Rapeseed is offset with gains for Soybeans, Sunflower seed, Groundnuts, and Cottonseed.

  • Brazil crop supply agency Conab has estimated the country's 2015-16 Soybean crop at 95.43 million tonnes.

  • Brazil has exported 3.816 million tonnes of Soybeans in August, tumbled from 5.787 million tonnes in July and 5.162 million tonnes last year, according to data from trade ministry.

  • The Brazilian Cereal Exporters Association (ANEC) estimated Brazil's 2016 Soybean exports at 54 million tonnes, down 3million from its previous forecast.

  • Argentina’s August Soybean crushing ended with a fall of 12.83% at 3.72 million tonnes, according to ministry of agriculture. August was the fourth consecutive month of decline in the volume of Soybean crushing.

  • Soybean processing of Argentina during the period from January to August totalled 30.16 million tonnes.

  • The Argentine Soybean Association estimates Soybean area will drop 2.5 percent to 48 million acres in the 2016-17 season.

  • Statistics Canada pegged the 2016 Canola crop at 18.3 million tonnes which is higher than August estimate of 17 million tonnes, but in line with the previous year’s level.

  • Production of Soybean in Canada is estimated to be virtually unchanged compared with 2015, totaling 6.0 million tonnes in 2016.

  • USDA’s forecast MY16/17 Cotton seed production of China is estimated by USDA at 8. 3 million metric tonnes (MMT) in MY 16/17.

  • Chinese Soybean importers reduced their shipments to 7.67 million tonnes in August as they wait for the release of beans from state reserves.

  • Total Soybean imports of China for the first eight months stood at 54 million tonnes versus 52.4 million tonnes a year ago.

  • China's Soybean demand growth is likely to fall this year due to plentiful state stocks and as the domestic crop grows by almost 13% to 13.1 million tonnes, said the China National Grain and Oils Information Center (CNGOIC).

  • CNGOIC expects Soybean imports in 2016/17 crop year to reach 85 million tonnes, up from 83 million tonnes in the 2015/16 crop year that ends this month.

  • The USDA revised 2016/17 China Soybean import figure down by 1 million tonnes to 86 million tonnes.

Outlook

  • Mustard Seed stocks at the various warehouses of NCDEX as on September 27 totaled at 18740 metric tonnes against 21,712 tonnes. Mustard Seed stocks is sharply down from 61,854 metric tonnes on September 27, 2015 which may support the prices.

  • Soybean plants in India are doing need based buying due to poor demand in Soybean Meal. Indian Soy Meal was uncompetitive even in the international market due to wide price difference.

  • Demand for Soybean Meal is expected to remain irregular from poultry farms on expectation of prices to fall in coming sessions in wake of new crop arrival. New Soybean crop is expected to hit the market from October onwards which may clear outlook going ahead.

  • Indian government's move to trim its import duties on CPO and Refined Edible Oils has disappointed Vegetable Oil industry officials in the country since it will put pressure on the local Oilseed farmers who are about to begin sowing of the new crop.

  • The reduction in import tax will put a burden on local Oilseed prices as India meets more than half its Cooking Oil requirements through imports.

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