A sharp drop in ex-factory soybean prices worried producers in Maharashtra ahead of the harvest season. As oilseeds trade above its government-declared Minimum Support Price (MSP) of Rs 3,950 per cwt, in recent days soybean prices have seen a decline of Rs 2,000 per cwt. , a further decrease is not excluded.
The importation of genetically modified soybean meal and the reduction in import duties on crude and refined soybean oil are presented as the main reasons for this price decline.
In recent months, soybean prices had reached an all-time high with average traded prices in the Latur mandi crossing 10,000 rupees per quintal. Ex-factory prices in districts like Nanded had even reached 11,000 rupees per quintal.
This was mainly due to the shortage of oilseeds, both in domestic and international markets. The increase in the price of oilseeds had led to a record price for deoiled soybean meal, which acts as an important source of protein for poultry feed.
The multiple representations of the poultry industry had led the government to authorize the import of 12 lakh tonnes of GM soybean meal. It would be the first time that the government allowed the import of genetically modified material into the animal feed industry.
Imports were to reach India by sea or the land port of Petropole by October 31. Of the 12 lakh tonnes, at least 4 lakh tonnes would reach Indian ports on time, industry insiders said. But since then, the government had allowed shipments to reach India before Jan.31, 2022, when the last date for the deals to be finalized was Oct.31.
Considering the extended period, the poultry industry now estimates that the 12 tonnes per lakh will land in India.
Industry insiders say the majority of the deals that have been signed relate to soybean meal from Argentina.
Till date 8 lakh ton agreements have been signed and 80% of this amount is expected to land in India in the next
a few weeks. The Bangladeshi meal would have taken less time to arrive by road, but it did not have much surplus to export. Thus, Vietnam and Argentina have become the main source of imports. The landed cost of imported soybean meal is around Rs 55-60 / kg while the ex-factory price of domestic products is around Rs 80-85 / kg.
However, producers have expressed concern over the continuing decline in soybean meal prices. At Latur wholesale mandi, the negotiated average price of oilseeds is Rs 8,200 per cwt – a drop of Rs 2,000 per cwt from the Rs 10,000 per cwt price that oilseeds had achieved.
The decline is more at the gates of the mills of Nanded, Latur, Osmanabad and Akola, where farmers can currently sell their products for Rs 6,000 to Rs 6,300 per quintal against Rs 10,000 to 11,000 per quintal.
The oil mills in the Latur market claim that the current decline is mainly due to the extension of the import window and also to the reduction in import duties for edible oil.
Manikrao Kadam, peasant leader from Parbhani district, called for an investigation into this drop in prices. “The national harvest has not yet arrived, but there is a drastic drop in prices. This needs to be investigated, ”he said.