REFINED SOY OIL

INTRODUCTIONINTRODUCTION

Soybean oil is the natural oil extracted from whole soybeans. Typically, about 18 - 19% of a soybean's weight can be extracted as crude soybean oil. The oil content of soybeans correlates directly with the temperatures and amount of sunshine during the soybean pod-filling stages. Soybean oil is the leading vegetable oil traded in the international markets, next only to palm oil.

To produce soybean oil, the soybeans are cracked, adjusted for moisture content, heated to between 140°F and 190°F, rolled into flakes, and solvent-extracted with hexane. The oil is then refined, blended for different applications, and sometimes hydrogenated. Soybean oils, both liquid and partially hydrogenated, are exported abroad, sold as "vegetable oil," or end up in a wide variety of processed foods. Most of the remaining residue (soybean meal) is used as animal feed.

PRODUCTION:PRODUCTION:

Soybean oil is basically used in cooking as edible oil. Soybean oil is used by the food industry in a variety of food products including salad dressings, margarine, bread, mayonnaise,

non-dairy coffee creamers and snack foods. It is also used to produce inedible products such as paints, varnish, resins, and plastics. Soy oil contains two types of fatty acids called omega-3 fatty acids and omega-6 fatty acids. The omega-3 fatty acids in soy oil are

similar to the type of fat found in fish oil.

Soybean oil accounts for 24% share of the vegetable oil traded in international market. Major soy oil producing countries are U.S., China, Argentina and Brazil contributing total of 35% of global Soybean Oil production in year 2011-12. The major exporters for soybean oil are Argentina (53% of the total world exports), Brazil (22%) and United States (12%). Asian countries like India, China, Pakistan, Bangladesh, South & Central American countries (Peru, Venezuela, Bolivia, Dominican Republic) and Africa (Egypt, Morocco) are considered as major buyers in world market.

USES

GLOBAL SCENARIO

USES

GLOBAL SCENARIO

Soybean

Soybean Hull Removal

Flaking & Conditioning

Hexane Extraction

Crude Soy Oil Recovery

De- Gumming

Refining

Soybean Hull Processing

Soy Meal Processing

Soy Meal

Gums & Lecithin’s

Ref Soy Oil

Soybean Handling & Cleaning

Attribute 2007-08Beginning Stocks (Mn MT)

Production (Mn MT)

MY Imports (Mn MT)

Total Supply (Mn MT)

MY Exports (Mn MT)

Total Dom. Cons. (Mn MT)

Ending Stocks (Mn MT)

0.1

1.3

1.1

2.4

0.0

2.3

0.1

0.1

1.3

1.6

3.0

0.0

2.8

0.3

0.3

1.7

0.9

2.9

0.0

2.6

0.3

0.2

1.5

0.7

2.4

0.0

2.3

0.1

0.3

1.6

0.8

2.6

0.0

2.6

0.1

DOMESTIC SCENARIODOMESTIC SCENARIO

India is the sixth largest producer of soy oil in the world, accounting for 4% of world production. India is the largest importer of edible oils in the world. India imports Soy Oil mostly from Argentina, followed by Brazil and US. In addition to imports, domestic production of around 1.6 million tons takes the annual soybean oil consumption of the country to 2.6 million tons.

In India, crushing of soybean for soy oil and meal starts from October and it peaks during the subsequent three - four months. Spot markets of Indore and Mumbai serve as the 'reference' market for soybean oil prices. While the Indore price reflects the domestically crushed soybean oil (refined and solvent extracted), Mumbai price indicates the imported soy oil price.

2008-09 2009-10 2010-11 2011-12

� � � � �L�o�c�a�l� �&� �G�l�o�b�a�l� �O�i�l�s�e�e�d�s� �p�r�o�d�u�c�t�i�o�n� � � � � �T�h�e� �s�u�p�p�l�y�-�d�e�m�a�n�d� �s�c�e�n�a�r�i�o� �o�f� �a�l�l� �c�o�m�p�e�t�i�t�i�v�e� �o�i�l�s� �a�n�d� �o�i�l�s�e�e�d�s� �i�n� �t�h�e� �c�o�n�s�u�m�i�n�g� �c�e�n�t�e�r�s�,� �v�i�z�.�,� �I�n�d�i�a�,� �C�h�i�n�a� �a�n�d� �E�U� � � � � �T�h�e� �c�r�u�s�h� �m�a�r�g�i�n� �b�e�t�w�e�e�n� �m�e�a�l�,� �o�i�l� �a�n�d� �s�e�e�d� � � � � �G�o�v�e�r�n�m�e�n�t� �p�o�l�i�c�i�e�s� �s�u�c�h� �a�s� �M�i�n�i�m�u�m� �S�u�p�p�o�r�t� �P�r�i�c�e� �(�M�S�P�)� �f�i�x�e�d� �f�o�r� �t�h�e� �c�r�o�p�,� �i�m�p�o�r�t� �d�u�t�y� �&� �e�x�p�o�r�t� �o�f� �i�t�s� �d�e�r�i�v�a�t�i�v�e�s� � � � � �E�x�p�o�r�t� �r�e�g�u�l�a�t�i�o�n�s� �i�m�p�o�s�e�d� �i�n� �t�h�e� �e�x�p�o�r�t�i�n�g� �c�o�u�n�t�r�i�e�s� � � � � �D�e�m�a�n�d� �f�o�r� �S�o�y�b�e�a�n� �f�r�o�m� �O�i�l� �e�x�t�r�a�c�t�o�r�s� �a�n�d� � �s�u�p�p�l�y� �f�r�o�m� �F�a�r�m�e�r�s� � � � � �I�n�t�e�r�n�a�t�i�o�n�a�l� �o�i�l� �p�r�i�c�e� �m�o�v�e�m�e�n�t� �o�n� �o�t�h�e�r� �e�x�c�h�a�n�g�e�s� �l�i�k�e� �C�B�O�T� �a�n�d� �B�u�r�s�a� �M�a�l�a�y�s�i�a� � � � �I�n�f�e�c�t�i�o�n�s� �a�f�f�e�c�t�i�n�g� �p�o�u�l�t�r�y� �a�n�d� �c�a�t�t�l�e� �l�i�k�e� �b�i�r�d� �f�l�u�

FACTOR INFLUENCING PRICES FOR SOY OIL FACTOR INFLUENCING PRICES FOR SOY OIL

GLOBAL PRODUCTIONSGLOBAL PRODUCTIONS

MAJOR CONSUMPTION COUNTRIESMAJOR CONSUMPTION COUNTRIES

MAJOR EXPORTING COUNTRIESMAJOR EXPORTING COUNTRIES

Source: USDA

Source: USDA

Delivery Specification

Position limits

Premium/Discount

Due Date/ Expiry Date

Expiry date of the contract:20th day of the delivery month If 20th happens to be a holiday, a Saturday or a Sunday then the due date shall be the immediately preceding trading day of the Exchange.

Delivery Logic

Special margin

Final Settlement Price

Maximum Order Size

Both Options

None

Delivery centerTrading hours

Indore (within a radius of 50 km from the municipal limits)As per directions of the Forward Markets Commission from time to time. Currently:Mondays through Fridays :10:00 AM to 05:00 PMSaturdays : 10.00 AM to 2.00 PMThe Exchange may vary the above timing with due notice.

Quantity variation +/- 2%

As per launch calendar

Name of Commodity Refined Soy oil

Ticker Symbol SYOREFIDR

Trading SystemBasis

NCDEX Trading SystemEx-tank, Indore inclusive of all taxes

Unit of trading 10 MT

Delivery unit 10 MT

Quotation/base value Rs. per 10 Kg

Tick size 5 Paise

Refined Soy Oil with the following specifications:

CONTRACT SPECIFICATIONS

Upon expiry of the contract, the delivery position would be arrived at by the Exchange based on the information to give/take delivery furnished by the sellers and buyers as per the process put in place by the Exchange for effecting physical delivery.

On the expiry of the contract, all outstanding positions not resulting in giving/taking of physical delivery of the commodity shall be closed out at the Final Settlement Price announced by the Exchange

Trading in any contract month will open on the 10th day of the month. If the 10th day happens to be a non-trading day, contracts would open on the next trading day.

Price limits

Daily price fluctuation limit is (+/-) 3%. If the trade hits the prescribed daily price limit there will be a cooling off period for 15 minutes. Trade will be allowed during this cooling off period within the price band. Thereafter the price band would be raised by (+/-) 1% and trade will be resumed.If the price hits the revised price band (+/-)4% again during the day, trade will only be allowed within the revised price band. No trade / order shall be permitted during the day beyond the revised limit of (+ / -) 4%

The Final Settlement Price (FSP) shall be arrived at by taking the simple average of the last polled spot prices of the last three trading days viz., E0 (expiry day), E-1 and E-2. In the event of the spot prices for any one of the E-1 and E-2 is not available, the spot price of E-3 would be used for arriving at the average. In case the spot prices are not available for both E-1 and E-2, then the average of E0 and E-3 (two days) would be taken. If all the three days' prices viz., E-1, E-2 and E-3 are not available, then only one day's price viz., E0 will be taken as the FSP.

In case of additional volatility, a special margin at such percentage, as deemed fit, will be imposed in respect of outstanding positions, which will remain in force as long as the volatility exists, after which the special margin may be relaxed.

500 MT

Member level: 125,000 MT or 15 % of Market OI, whichever is higher Client level: 25,000 MT The above limits will not apply to bona fide hedgers. For bona fide hedgers, the Exchange will, on a case to case basis, decide the hedge limits. Near month limit (Applicable from 28 days prior to expiry date)

Member level: 30,000 MT or 15% of market wide near month open position, whichever is higherClient level: 6,000 MT

Moisture & insoluble impurities, % Max: 0.10 Color, " cell, Lovibond Y+5R, Max: 4 Refractive Index at 40C: 1.4650-1.4710 Specific Gravity at 30C 25/25: 0.917-0.921 Saponification Value: 189-195 Iodine Value (Wijs): 120-141 Unsaponifiable matter, % by mass, Max: 1.5FFA, % Max: 0.25Flash point, Pensky Martin Method, C, Min: 250

Closing of contract

Opening of contracts

No. of active contracts