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India Oilseeds and Products Update November 2011

07 December 2011

USDA Foreign Agricultural Service

India's favourable monsoon rains encouraged kharif planting of oilseeds, according to the USDA Foreign Agricultural Service.

SOYBEAN PRODUCTION EXPECTED TO REACH A RECORD 11 MILLION TONS

According to the latest Government of India (GOI) Ministry of Agriculture progressive planting report, the total area planted to kharif oilseeds (minor oilseeds are not included) was 14.9 million hectares, marginally higher than last year. Good monsoon rains promoted plant emergence throughout most of the growing areas. Farmers increased planting of soybean, cotton, rice, sugarcane and castor crops, showing relatively less interest in coarse cereals and pulse crops.

Soybeans were planted on a record 10.3 million hectares, an increase of 10.4 percent over the previous year. Favorable planting conditions helped extend the window for planting, contributing to higher kharif season soybean acreage in Madhya Pradesh, Maharashtra and Rajasthan. Based on preliminary field assessments, MY 2011/12 soybean production is forecast to reach a record 11 million tons. Kharif planting conditions were less favorable for peanut and sunflower. However, despite a 14 percent decrease in peanut kharif planting, MY 2011/12 production should reach 5.4 million tons from 5.3 million hectares. Similarly, assuming normal rabi season (winter sown) conditions, MY 2011/12 sunflower production is forecast at 625,000 tons from 1 million hectares.

INITIAL DRY WEATHER CONDITIONS DIDN�T DETER RAPESEED-MUSTARD PLANTING

According to the latest GOI Ministry of Agriculture planting estimate for rabi oilseeds, planting of rapeseed and mustard increased 103,000 hectares compared to the previous year, reaching 5.6 million hectares. Most of the increased acreage was in Rajasthan and Uttar Pradesh. Dry weather conditions, through October 2011, delayed planting in the major growing regions. However, good soil moisture conditions retained from recent monsoon rains had replenished soil moisture conditions and have recharged ground water levels, which had positively impacted planting of winter crops like rapeseed-mustard. Planting of rapeseed and mustard will be mostly complete by the end of November.

EDIBLE OIL IMPORTS ARE FORECAST HIGHER AT 9 MILLION TONS

Growing consumption, competitive international prices (Chart 1) and a zero import duty on crude edible oils will continue to encourage Indian imports of edible oil, particularly of palm oil. While the expected increase in domestic oilseed crushing could limit imports, MY 2011/12 edible oil imports are forecast to reach 9 million tons, up 9 percent over last year. The import basket includes 7.2 million tons of palm oil, 1 million tons of soybean oil, 800,000 tons of sunflower seed oil, and 40,000 tons of other edible oils. During the period October 2010 through September 2011, India imported 8.3 million tons edible oil, a 5 percent decline from the previous year (Table 1).

OILMEAL EXPORTS ARE FORECAST AT 5.7 MILLION TONS

Assuming Indian oil meal remains competitive in global markets, MY 2011/12 oil meal exports (excluding rice bran and castor meal) are forecast to reach 5.7 million tons; marginally lower than the previous year. The export forecast includes 4.4 million tons of soymeal, 1.25 million tons of rapeseed meal and 10,000 tons of other oilmeals. However, growing domestic oilseed demand for feed and food use (especially soymeal) could limit export growth. Total oil meal exports in MY 2010/11 were up 52 percent, reaching 5.8 million tons (Table 2). Strong international prices encouraged Indian soy meal exports in MY 2010/11 (Chart 2).

Chart 1. India: Imports and Landed price of Crude Soy, Sunflower and Palm Oils, In U.S. Dollar Per Metric Ton

Chart 2. India: International Prices of Oilmeals and Exports, October 2009-September 2011, In U.S. dollar Per Metric Ton

Further Reading

- You can view the full report by clicking here.

December 2011

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