Pakistani importers are negotiating over the purchase of about 66,000 tonnes of soybeans to be sourced from the United States (US) or Brazil, European traders said on Wednesday.
The soybeans were being sought for shipment between November 15 and December 15, they said.
Pakistan has been a heavy buyer of soybeans this year as import duties and local sales taxes have made soybean imports for local crushing more attractive than soymeal imports, one trader said.
“Pakistan has already purchased over 700,000 tonnes of soybeans since the end of February,” one trader said. “Pakistani processors are crushing over 75,000 tonnes of soybeans monthly. Two vessels are loading from the United States and one from Brazil.”
Pakistan’s soybean imports are expected to rise after the import tariff on soybean meal was increased from July 1, the US Department of Agriculture (USDA) has said.
The USDA forecasts Pakistan’s soybean imports will rise from 450,000 tonnes in the 2014-15 season to about 1 million tonnes in the 2015-16 season.
“This is now going to increase as changes in the import duty structure for soymeal have resulted in an increase in local crushing, which will generate local employment and save foreign exchange,” a trader said.
Processors are turning to soybeans from their traditional crushing of rapeseed/canola.
Crushing soybeans produces more meal and less oil than processing rapeseed, which has a higher oil yield when crushed. This means that there is also increased Pakistan import demand for soy oil, traders said.
“Pakistani importers have also purchased about 75,000 tonnes of soy oil for July/October arrival and I expect around 100,000 tonnes of soy oil to be bought this year,” one trader said.
Soy oil prices were around $692 to $710 a tonne c&f, he said.
Last year Pakistan imported about 85,000 tonnes of soy oil. Some imports of Indian soymeal continue during the transition process, he said.
India was traditionally a major soymeal supplier to Pakistan and faces loss of business as Pakistan increases its own soybean crushing.
