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Presented by : Atul Mundhra & Associates, Indore A GRO F EEDS (93013 38000, 98260 38000). Approach Soy S&D Differently. Soy in India – a Brief. India produces various oil-seeds & soy is prominent of them It is a kharif production in India Monsoon is a major factor for this crop

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Approach soy s d differently

Presented by :

Atul Mundhra & Associates, Indore


(93013 38000, 98260 38000)

Approach Soy S&D Differently

Soy in india a brief
Soy in India – a Brief

  • India produces various oil-seeds & soy is prominent of them

  • It is a kharif production in India

  • Monsoon is a major factor for this crop

  • India has been producing soy since last 5 decades

  • Now it reached at the level of more than 10 Million Tons for last 5 years

  • That’s why; India is 5th Largest producer of soy in the world

  • Almost 90 % crop of India is produced in three states

  • Central India is the leading hub of Soy Industry having a bench mark of price

  • MSP of the Soybean for the year 2012-13 is 2240 per quintal

Soy distribution in india
Soy Distribution in India

All figures are in Lac of Metric Tones

(Source : COOIT)

Indian soymeal a brief
Indian Soymeal – a Brief

  • Indian Soymeal is 100 % non GMO product

  • It is well accepted in more than 60 Countries

  • India produces approx 75 lac tons (LT) Soymeal annually

  • Out of which export remains around 42 LT including 10 LT export to neighbor countries & domestic use at 33 LT approximately

  • Ratio of domestic use to overseas exports remain 1:1

  • 98 % of the Soymeal is used into animal feed, poultry industry & aquaculture

  • India is 4th largest exporter of Soymeal in the world

  • CBOT is the major international reference market , however India does have its separate S&D for price discovery

S supply status
‘S’ - Supply Status

  • There are more than 90 Soy processors across three states however only 20 % plants run through-out the year

  • Top 3 processors of country crushes 40 % of the total crushing

    Prevailing Pattern

  • Now-a-days Indian soy industry is running at the same model of brazil soy industry wherein six months supply is oriented to export & another six month to cater domestic demand

  • Sellers remain reluctant in supplying small cargo to small buyers

  • Lack of attention towards Quality check measures

  • Usually offer a selected range of products

  • No standard mechanism for grievance redressal - for both Seller & Buyer

  • No system of Buyer’s feed-back about quality & supply performance

  • Production of steady cargo instead to the requirement as per Buyer

Supply revolution
Supply Revolution


  • Seller can fix an eligible credit supply risk for small & regular buyers

  • Sellers should ensure a thorough quality check on regular basis

  • There should always be a variety of product offerings like Hi-pro, Super Hi-pro etc.

  • Seller should prefer to provide goods according to buyer’s requirement rather than a steady cargo

  • Sellers should be kind enough to redress the grievances of the buyers

  • Sellers should have a proper feed-back system to improve the quality & performance

D demand status
‘D’ - Demand Status

Prevailing Pattern

  • Domestic buyers generally purchase Soymeal on regular & ready basis without considering the forward position of availability

  • Lack of tie-up with sellers for a constant supply through-out the year

  • Prefer to buy from traders even on high credit appraisal due to liquidity crunch

  • Buyers reluctant to pay true value of ‘quality’

  • Absence of independent quality assessment

  • Refrain to refer Soy S&D on regular basis

  • Absence of hedging mechanism

  • Crop Nos. are always estimated & not authenticated unlike in US, Argentina & Brazil there is an association for Crushing & Exports

Demand revolution
Demand Revolution


  • Should change the buying pattern on deferred window mechanism (As in export)

  • Ensure tie-up with sellers for a constant supply through-out the year to avoid unpredictable abnormal shortage later

  • Prefer to buy directly from crushers with eligible credit appraisal

  • Refer Data of Soy Supply & Demand on regular basis due to fragmented industry & unauthenticated data

  • Should take a proper hedging of raw material (meal) through physical forward contract instead of secondary market because E-contract settles on spot price of central region basis

  • A standard domestic Soymeal contract should be designed separately for local buying & that too for different locations

  • An Independent Arbitration body should be there & their arbitration should be enforceable to both Seller & Buyer

This S&D has been prepared by us

  • There always remain variation between official estimates & trade estimates

  • Supply & Demand is made more out of educated guess in absence of systematic mechanism to derive concrete quantity nos.

Intercessor an eminent link
Intercessor – an eminent Link basis

  • Intercessor plays an important role in supplying & procuring Soymeal for the soy industry

  • Soy industry is well organized but inland trade is mostly unorganized

  • Unfortunately, India does not have a direct mechanism for automatic price discovery of domestic meal & in absence of that Intercessor remains a good platform for finding correct price discovery

  • One may keep a direct track of Soy S&D on regular basis through a Intercessor

  • Intercessor also mitigate the risk of both the parties to trade through his proper co-ordination, co-operation & knowledge

  • Information related to soy industry is readily available to mediator which can be helpful to buyer & seller as well

  • Always stand as primary arbitrator in case of contract dispute

Thank you
Thank you basis

Sincere acknowledgement to our Research Team :

CA Naynesh Gandhi

Nikhil Parwal

Presented on : 4TH May 2013

At : Hotel Radisson, INDORE

Feel free to contact on

0731 – 406 2626 / 27, 2566 500

Email : [email protected]

Global Trade Point of Agri Commodities Since - 1982