Indian traders have cancelled nearly 25,000 metric tonnes of soymeal export contracts for May and June shipments, marking the first such cancellation in nearly five years. According to Reuters reports, these cancellations represent a significant shift in India's soy trade strategy as domestic market conditions have become increasingly challenging. The move comes as domestic prices have surged, reversing traditional trade flows and forcing traders to abandon export opportunities. The cancellations, known as washouts, are rare in the soymeal trade due to infrequent price swings and did not involve penalties for either party.
Domestic soymeal prices have experienced a dramatic surge, climbing nearly 41% within a month to reach around ₹66,000 per metric tonne. As reported by Reuters, this represents the highest level seen in four years, making overseas commitments financially unviable for Indian traders. The sudden spike has pushed Indian soymeal export offers for June shipments to nearly $695 per metric tonne free on board, up from about $475 last month. "It wasn't possible for sellers to absorb the $200 per ton increase, so they mutually agreed with buyers to cancel the contracts for May and June shipments," a person familiar with the developments told Reuters. These cancellations are rare in the soymeal trade due to infrequent price swings.
Due to high domestic prices, India is not receiving new soymeal export orders, prompting traders to increase imports from African countries. According to Vinod Jain, founder of agricultural goods exporter Suraj Impex, India's soybean imports could hit a record 800,000 tonnes by September 2026. This compares dramatically to last year's imports of around 2,000 tonnes according to data from the Soybean Processors Association of India. India allows imports only of non-genetically-modified soybeans, limiting supplies to select African nations such as Benin, Niger, Togo and Nigeria. These countries sell non-GM beans at a premium over genetically modified ones, with traders purchasing African soybeans at $700-$760 per ton for June-July shipments to India. As reported by Reuters, traders have booked at least 80,000 tonnes of soybeans this month alone, with purchases continuing as local prices remain firm.
The price surge has been attributed to tightening domestic soybean supplies, creating a supply-demand imbalance in the Indian market. According to trade sources cited by Reuters, this domestic shortage has been caused by a decline in soybean production, forcing Indian traders to pivot from their traditional export-focused strategy to importing soybeans from alternative sources. Industry experts cited poor domestic soybean production and tight inventories as the key reasons behind the supply crunch. The cancellations are expected to boost shipments from North and South American soymeal suppliers to Asian buyers who usually source from India, as these suppliers are now better positioned to meet the increased demand in the Indian market. Soybean supplies are expected to remain tight until the new season's crop arrives in September and October, prompting traders to import from African countries to bridge the supply gap.
