Market Trends: Prices Stabilize After Long Decline

After a prolonged period of declining prices, soybean rates have started to recover, with prices increasing by approximately USD 0,18–0,24 per kg over the last 10–11 days. Buyers entering the market at lower prices halted the slide and boosted demand. Current trends suggest a chance of further price improvement in the domestic market.

Earlier this month, soybean prices hit their lowest point due to weak international demand:

• Madhya Pradesh: USD 0,44–0,50 per kg
• Maharashtra: USD 0,44–0,49 per kg
• Rajasthan: USD 0,46–0,50 per kg

The drop in prices also caused arrivals in markets to weaken, as producers avoided selling at these lower rates. Across the country, soybean arrivals were around 0.3 million bags.

Futures Trading Ban and Market Sentiment

The government’s decision to extend the ban on soybean futures trading until January 31, 2025, disappointed many traders. Despite this, the market has shown signs of recovery as buyers return to take advantage of the lower prices. Prices have increased by about USD 0,22 per kg in just 10 days, and traders expect further improvement.

Soybean Meal and Oil Prices: Key Drivers

Soybean prices are closely tied to the prices of soybean meal and oil. Export demand for soybean meal has dropped significantly this season, falling to 0,24 million tonnes, compared to 0,385 million tonnes during the same period last year. This decline of 0,145 million tonnes in exports has impacted soybean prices domestically.

Soybean oil prices also declined due to a slowdown in the international market. In Kolkata, soybean oil is priced at USD 1,43 per kg, about USD 0,012 per kg lower than palm oil and crude palm oil.

Impact on Producers and Stockists

Producers and stockists have faced significant losses due to falling prices of soybean meal and oil. Plant purchases of soybeans have also decreased steadily, further squeezing profits. While soybean production in India increased this year, higher global production, especially in Brazil, is expected to keep international prices in check.

India’s soybean production this year is estimated at 12.5 million tonnes, up from 11.8 million tonnes last year. Madhya Pradesh and Maharashtra contributed the most to this increase, with production rising by 0.293 million tonnes and 0.325 million tonnes, respectively. Other producing states, such as Rajasthan, Telangana, Karnataka, and Gujarat, saw no major changes.

Although there is room for further buying in the domestic market, significant price increases are unlikely. Higher production in Brazil, one of the largest global producers, is expected to cap price growth in the international market. However, domestic prices may see some modest improvement in the coming weeks.

Conclusion: Modest Recovery with Limited Growth

The soybean market is showing signs of recovery after months of decline. While prices are stabilizing, major price hikes seem unlikely due to global supply pressures. Producers and traders should focus on current opportunities while keeping an eye on international trends.





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