20% soybean may remain uncrushed

Around a fifth of the country’s soybean output is set to remain uncrushed this season due to a sharp fall in its price and cheap imports of palm oil from Indonesia and Malaysia, the world’s two large producers.

The Soybean Processors Association of India (SOPA) has estimated India’s soybean output at 11.49 million tonnes in 2016-17. With a carryover stock of 441,000 tonnes, availability of soybean for crushing is 8.5 million tonnes. Farmers are likely to use 1.2 million tonnes for sowing in the ongoing kharif season. SOPA estimates 150,000 tonnes of direct consumption and 250,000 tonnes of exports.

“India will have over 2 million tonnes of soybean as carryover stocks for the season beginning November 2017. The reasons for such a large carryover stock are falling prices and cheap imports of refined and crude palm oil from Malaysia and Indonesia,” said DN Pathak, executive director, SOPA.

Farmers are avoiding sowing soybean this season due to lower realisation and weak monsoon rainfall over the past month in major growing centres.

The agriculture ministry on July 14 reported a sharp decline in the area under oilseeds, including soybean, from 11.58 million hectares last year to 10.39 million hectares.

“Soybean sowing has only reached 60-70 per cent of its usual area. We hope rains improve, otherwise it might warrant re-sowing,” said Dinesh Shahra, managing director, Ruchi Soya Industries, one of India’s largest producers of edible oils.

The Solvent Extractors’ Association of India (SEA) estimates a 15 per cent increase in imports of vegetable (edible and non-edible) oil at 1.34 million tonnes in June from 1.17 million tonnes in the same month last year.

“Soybean and rapeseed prices are below the minimum support prices (MSP). Prices of these oilseeds have fallen 20-30 per cent over the last one year. The SEA has asked the government to increase import duty on crude palm oil to 20 per cent and refined palm oil to 35 per cent,” said BV Mehta, executive director, SEA.