Soybean has been the major
component of the oil seed crop for India. Of the total nine oilseed crops
production it contributes to about 35.00 per cent. In recent times the stock
management of soybean and enhanced demand is imposing serious challenge for the
country owing to the prevalent economic crises in European Union and improving
demand in the global markets. There is a need for an effective price and stock
management strategy in order to achieve maximum advantage of the expected price
hike.
India’s Soybean production in
2012-13 is estimated at around 127.32 lakh MT, up from around 122.14 lakh MT
produced in 2011-12. India’s support prices in 2013-14 are hiked by about 14
per cent from the levels in 2012-13 with MSP of Rs. 2500 per quintal for black
soybean and Rs. 2560 per quintal for yellow soybean. About 93.92 per cent of
the total production in the country was contributed by 3 states. The top soybean
producing states of the country are Madhya Pradesh (52.03 per cent), Maharashtra
(32.63 per cent) and Rajasthan (9.26 per cent). India holds second position in
the major soybean oil consumer’s list after China. The Indian government has imported
8.54 million MT of edible oil in the marketing year 2012-13 (October –
September) out of which about 0.85 million MT was soybean oil.
Global soybean production is
projected almost unchanged at a record 281.7 million MT as larger crop
forecasts for Brazil and Paraguay mostly offset reductions for the United
States, Canada, China, and Russia. Soybean production for US is 85.7 million MT,
Brazil is forecasted to produce a record 88 million MT, up 3 million MT on
increased area. Argentina is expected to reach 54 million MT and soybean production
for China is reduced 0.3 million MT to 12.2 million MT, with lower yields
resulting from excess rainfall and flooding in the northeast. If realized, this
would be China’s smallest soybean harvest since 1992-93.
The soybean market price variation
study indicates that the price volatility is on the rise since June 2010 owing
to reports of higher seasonal demand. Looking at the price trends of the past
years, the prices tend to decline during the June-Sep. period on increased
hopes of higher oilseed sowings in Kharif and across northern hemisphere
oilseed growing countries. The surge in demand starts towards end October and
reaches peak by May. In 2012-13, the
Indian Soybean prices have followed similar pattern from the current levels following
increased demand from Chinese traders. The demand side is bullish. The USDA is
forecasting a 4% increase in U.S. exports, but export commitments to date show
that sales are ahead by 15.8%. The entire anticipated increase comes from
China. The estimate for Chinese imports is 69 million MT, up 9.5 million MT, or
16 per cent from last year.
India’s
soybean production for the crop year 2013-14 (July - June) is expected to reach
around 104.50 Lakh MT. The expectation of a lower crop and increased export
demand (over 10 million MT) is expected to keep the prices bullish with increased
volatility.
