Falling soyabean crop area vexes processors

PUNE: Soyabean processors, the bedrock of India's protein industry, are increasingly getting anxious as acreage in Madhya Pradesh, the largest producer, by July 4 was barely a fifth of what it was last year.

Since soyabean prices have more than doubled during the last six months, the industry is waiting for a good rainfall in July to ensure adequate supply of the affordable raw material. In case the price rises further, it will hit consumer budgets through more expensive cooking oil, chicken and eggs.

"Soyabean sowing was completed over 4.26 lakh ha in Madhya Pradesh till July 4 as against 23 lakh ha during the same period last year. If we get good rains just for two days, sowing can be completed as farmers are ready with seeds and other inputs," said Vijay Thakare, deputy director (agriculture), Madhya Pradesh.

The area under soyabean in Madhya Pradesh in 2011 was 62 lakh ha, which is close to 62% of the total soyabean area in the country.

"We are concerned about the delay in sowing in some parts of Madhya Pradesh, Maharashtra and Gujarat. But we are hoping for around 5-10% increase in acreage under soyabean during this season.

A higher price realisation has motivated farmers to increase the area. The weather department is still hopeful of a reasonable monsoon and we can expect production to be similar to or better than last year's," said Dinesh Shahra, MD, Ruchi Soya Industries.

Soyabean Processors Association of India spokesperson Rajesh Agrawal said: "Due to the rainfall in the last two days, sowing has progressed in Madhya Pradesh but this may not be reflecting in the statistics.




The next 15 days are crucial for India and the US - which is also undergoing a dry spell - as prices will be decided by the US situation. We are confident that the entire sowing will take place by July end."

However, there is good news from Maharashtra, the second largest soyabean producer, where sowing has progressed considerably after the first spell of rains. According to the statistics available from the state agriculture department, soyabean was sown over 12 lakh ha area till July 2, 56% of the soyabean acreage in Maharashtra.

"We are expecting a considerable increase in soyabean area in Maharashtra, Andhra Pradesh, Karnataka and Tamil Nadu due to an expected shift from cotton to soyabean," said Agrawal.

Prices opened firm on Indore markets on Thursday on better buying support against poor availability. "Prices started gradually increasing from 1,750/quintal in October last year. Currently, they are ruling at 3,900/quintal to 4,000/quintal, a jump of almost 10% in the last 15 days," said PS Pangaria, executive director, SOPA.

Increased buying of Indian soyameal by Iran at a premium of $40/tonne has supported soyabean prices during the last three months. Demand from Iran has increased because of the Western embargo.