The Hindu Business Line : Groundnut, a drag on oilseeds production

According to an NCDEX report on “Impact of floods on agricultural output”, groundnut crop in 4.45 lh of Andhra Pradesh and Karnataka may be affected.

M. R. Subramani
K.V. Kurmanath

Chennai/Hyderabad, Oct. 16

Is the country shedding its dependence on groundnut for edible oil production? A look at the statistics shows that perhaps it is heading towards that direction. One reason for this is that soyabean production has increased sharply in the last couple of years, reducing the dependence on groundnut.

Between 2003-04 and 2005-06, groundnut helped a lot in stabilising oilseeds production. During the same time, soyabean, too, began gaining ground with the output exceeding 70 lakh tonnes (lt).

During 2006-07, groundnut production (kharif and rabi) dropped to 48.6 lt but a then record output of 88.5 lt soyabean helped steady the oilseeds production.

The next year saw oilseeds output rising by nearly 30 lt with groundnut rebounding. Last year, groundnut production dropped to 42.2 lt.

Still, an over 90 lt soyabean production helped in bridging the demand-supply gap. In between, rising production of rapeseed, a rabi crop, of over 70 lakh tonnes has also come in handy.

Weather plays truant

So, what is in store this year? Unfortunately, the weather has been harsh this time. This has had a telling effect on groundnut. If it was a prolonged dry period that hit sowing and development of the crop in the early stages, unseasonal rain in Karnataka, Maharashtra and Andhra Pradesh early this month have caused some more harm.

The rains are likely to have marginal effect on the soyabean and sunflower crops too. “The area under groundnut has declined to 44.06 lakh hectares (lh) from 53.04 lh last year,” says Mr B.V. Mehta, Executive Director of the Solvent Extractors Association of India. Area under groundnut in Gujarat, that tops in the crop’s production, has dropped over seven per cent.

According to an NCDEX report on “Impact of floods on agricultural output”, groundnut crop in 4.45 lh of Andhra Pradesh and Karnataka could be affected.

Karnataka officials fear that output of oilseeds, especially groundnut and sunflower, could drop 50-60 per cent against a target to produce 16 lt.

“Groundnut area has dropped nearly 10 lakh hectares which is below expected levels,” says Mr Davish Jain, President of the Central Organisation for Oil and Trade (COOIT).

Estimates made by the Andhra Pradesh Government show that a rise in groundnut productivity up to 555 kg a hectare against 300 kg last year could help make up for the lower area (9.78 lh versus 15 lh). Production in the State has been pegged at 5.34 lt against 4.50 lt last year.

Mr Govindbhai G. Patel, former COOIT President, the rains could affect the quality of groundnut in Karnataka and Andhra Pradesh. “Against 42 lt last year, we can expect 31-32 lt crop only this year,” he says.

This means much will depend on the soyabean crop, which estimates peg between lower than 90 lt and 97 lt.

Soyabean crop

“We don’t think there will be loss in soyabean quantity due to rains, particularly in Maharashtra. But there can be damage to quality especially in Maharashtra,” says Mr Patel, pegging the output below 90 lt.

This is against a projection of 97 lt made by the Indore-based Soyabean Processors Association of India. For now, the early sowing varieties that are arriving from the Malwa region in Indore are of satisfactory quality, says Mr Jain.

“Everything depends on the late sown varieties such as JS335 and similar ones. These have undergone a dry patch during the second half of September and we have to see how the crop behaves,” he says.

“We have not heard about problems with late sown varieties, though a small part of early sown varieties have been affected,” says Mr Mehta.

Other oilseeds

There are other oilseeds which contribute in a small way. Sunflower production could improve to 3.5 lt but Mr Patel says around 50,000 tonnes could have been lost due to the rains. Sesame production is also seen rising to 3.5 lt, while Niger and Toria output is likely to be unchanged. Including castor, the kharif oilseeds output is being pegged by the industry and trade at 141.9 lt against 150.5 lt.

“There is some hope. Last week’s rains will benefit the rabi crop,” says Mr Mehta. During the last couple of years, the rabi oilseeds crop has come in handy to beef up production. But that is unlikely to deter the deluge of vegetable oil imports being witnessed currently.

This oil year ending this month could see nearly 85 lt of vegetable oil being imported.

The industry and importers see that figure touching at least 90 lt next season if the prices are stable and government policies are favourable.

(With inputs from Vishwanath Kulkarni in Bangalore)

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