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Govt unlikely to allow imports of 1.2 mln tn of duty-free soymeal

Informist, Thursday, Apr 8, 2021 

 

By Kaushal Verma

 

NEW DELHI – The government is unlikely to allow imports of 1.2 mln tn soymeal at zero duty in the current financial year to support the poultry and livestock industry, a government official said today. 

 

"Prices of local soymeal are very high while in global markets it is quite cheaper. Higher prices of domestic soymeal are hitting the poultry and livestock industry," the official said. Soymeal is used as a key feedstock in the poultry industry.

 

Late last week, the All India Poultry Breeders Association requested the government to allow 1.2 mln tn duty-free imports of the commodity as the industry is suffering due to higher prices. 

 

The free-on-board price of soymeal was $675 per tn, $200 higher than the price offered by South American countries, said an official with the Soybean Processors Association of India. 

 

Since it is not genetically modified, Indian-origin soymeal commands a premium over its American counterpart. It has a higher protein content of 44-46% against the 35-40% protein found in genetically-modified soymeal. 

 

Soybean prices on the National Commodity and Derivatives Exchange had hit an all-time high of 6,491 rupees per 100 kg on Monday. 

 

Lower arrivals in domestic markets are boosting prices of soybean and soymeal, traders said. The oilseed's supply is slowing down in the ongoing lean arrival season.

 

Around 5.5 mln tn of soymeal produced in the country is consumed in domestic markets, largely by the livestock and poultry sectors. The remaining demand comes from the food sector. 

 

Referring to other options instead of allowing duty-free soymeal imports to cool off domestic prices, the official said increasing duty on exports of the oilmeal might also depress domestic prices. However, the government does not seem likely to raise export duty anytime soon.

 

A cut in edible oil import duty may also weigh on prices of locally-grown soybean, the official said. 

 

The food ministry has sent a proposal to the empowered group of ministers to review edible oil prices and take a call on the duty cut. The edible oil import basket primarily comprises palm oil, sunflower oil, and soyoil. 

 

Soybean, which is crushed to produce soymeal and soyoil, accounts for around 30% of the total oilseed basket.  End

 

US$1 = 74.64 rupees

 

Edited by Snigdha Kuttikat

 

 

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