Vietnam's meal sector eyes India GM soymeal talks amid export hopes

18 Aug 2021 | Veronika Prykhodko

Vietnamese feed makers are eyeing developments in the Indian meal market and could be poised to export to the country if the Indian government gives a green light on genetically modified soymeal imports, trade sources have said.

The Indian government was expected to lift its current import ban and allow local market participants to import around 1.5 million mt of soymeal with an import levy that is expected to be placed at 16.5%, according to industry sources.

However, the news was broken by an India-based feed industry association and is yet to be officially confirmed by the government.

Despite the uncertainty, Vietnam-based traders are eyeing developments and are confident that soymeal offers would be competitive versus other origins with a delivered CFR India price equivalent at around $500/mt, while US origin soymeal was quoted at around $650/mt, according to traders.

Being one of Asia’s biggest feed consumers and animal feed compound producers, Vietnam rarely exports soymeal, but the potential cash opportunity in supplying soymeal to India comes as demand from the domestic sector shows signs of slowing down.

“This is a very rare opportunity, as India doesn't open imports of GMO soymeal usually, and the profit potential is great, as Vietnam only exports soymeal to Malaysia when they have a shortage,” a local trader told Agricensus, estimating the size of exports on that route at around 10,000 mt per year.

India is facing a soybeans production shortage caused by heavy rains and unfavourable weather conditions, with local farmers expected to harvest around 11.9 million mt of soybeans, down from the 12.9 million mt harvested last year.

This led to local soymeal prices skyrocketing to as high as $1,000-1,200/mt, forcing local traders to seek cheaper cargoes overseas.