Soybean oil prices likely to continue to taper, says industry association

DN Pathak, Soybean Processors Association of India (SOPA) believes that soybean oil prices will continue to taper as supplies are strong.  “We don’t see anything bullish in the current market scenario,” he told CNBC-TV18.

Soybean prices haven’t seen much support in the last couple of months with international markets near 3-year lows.

Pathak noted that farmers have been holding on to soybean stock in the hope that the prices will at least be slightly above the minimum support price (MSP) but that is not happening. “I don’t see that happening soon, overall there is a rejection among the farmers and the support does not seem to be coming from anywhere,” he said.

Overall scenario is grim for the oil seeds and oil crushing industry, he believes. However, there could be some price action after the general elections.

Speaking about the ongoing farmer protests on MSP, he said, “I don’t know whether it is legally possible to give legal guarantee.”

The farmer protest, organised by groups primarily from Punjab, Haryana, and Uttar Pradesh, have two major demands; one, MSP should be written into law, and two, the calculation of MSP should include assumed rent (even in case of owned land) as well as some capital cost.