 "Deficient rainfall to weigh on soybean production")
Weed and pest infestation in the standing crop in major producing regions due to deficient rains is likely to weigh on soybean crop and its prices during the impending kharif harvesting season.
Despite a sharp increase in the overall acreage under soybean, its output is likely to remain range-bound this year because of crop damage. The impact has already started reflecting on soybean prices.
According to government estimates, soybean acreage during current kharif season has pegged at 114.2 lakh hectares (Lha) till Aug 28, up by about 10 Lha compared to the normal area averaging last five years and higher by about 4 Lha than last year. However, the higher acreage will likely be offset by the lower yield.
“Plants have started growing pale in the field due to the deficiency of moisture in major growing areas of Madhya Pradesh. (The) Situation is somewhat similar in other states including Maharashtra and Andhra Pradesh,” said Davish Jain, chairman of Indore-based Soybean Processors Association of India (Sopa). “So, the increase in acreage will be nullified by lower yield, resulting into overall soybean output similar to last year. The output may even decline if rainfall does not take place in the next seven to ten days.”
In its latest assessment, Sopa has estimated that crop condition in 12% of the total coverage area is ‘very poor’, while another 17% is ‘stressed’. About 60% of growing area is normal, 12% ‘good’, but only 6% has been labeled ‘very good’.
“Owing to lack of rains after sowing, weedicide could not be sprayed, leading unusual growth of weeds in some areas resulting into attack of inspects and pests. Except for Malwa and Nimar regions of Madhya Pradesh and some areas of Marathwada in Maharashtra, the crop condition is normal. Soybean crop in the country still needs one or two rains for a normal yield,” said Jain.
Following the deficient rainfalls forecast this monsoon season, soybean price surged to Rs 4,200 a quintal in April-May after moving in a thin range of Rs 3,300-Rs 3,470 a quintal between January and April. The oilseed later fell sharply to touch Rs 3,200 a tonne in spot market
In futures, however, soybean for delivery in October slumped to Rs 3113 a quintal early September despite reports of deficient rainfalls from the level of Rs 3576 a quintal in May. Following reports of gradual receding of monsoon, however, the oilseed price started recovering to trade currently at Rs 3274 a quintal on September 7 on the benchmark National Commodity & Derivatives Exchange (NCDEX).
“Bullish sentiments are currently appearing among the market participants on reports of infestation of pests in Madhya Pradesh and fear of poor monsoon progress during September. Moreover, in September US Department of Agriculture (USDA( report, there is possibility soybean output revising downwards and increase trade of soybean which may have bullish impact and the prices may surge to Rs 3400 / 3630 per quintal levels for short term,” said Ritesh Kumar Sahu, Research Analyst with Angel Commodities Broking.
“However,” he added, “we expect the soybean prices to touch Rs. 3,000 per quintal and trade in the range of Rs 2,900 – 3100 a quintal once the arrivals start in spot market across the country during October-November.”
The USDA forecasts India’s soybean output at 11.5 million tonnes in 2015-16 as against 10.5 million tonnes estimated by India’s Ministry of Agriculture for 2014-15. Meanwhile, stockists have started offloading their holding ahead of the new season harvest. Still, experts forecast, around 1.0 – 1.5 million tonnes of soybean would be carried out for next season.
(Source: Ministry of Agriculture, * Trade estimate)
Despite a sharp increase in the overall acreage under soybean, its output is likely to remain range-bound this year because of crop damage. The impact has already started reflecting on soybean prices.
According to government estimates, soybean acreage during current kharif season has pegged at 114.2 lakh hectares (Lha) till Aug 28, up by about 10 Lha compared to the normal area averaging last five years and higher by about 4 Lha than last year. However, the higher acreage will likely be offset by the lower yield.
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The Indian Meteorological Department (IMD) forecast 12% lower rainfalls this year. The progress of monsoon has been dull in August (22% lower), while forecasts of lower rains in September is raising concern about the yield of the crop in certain parts of Madhya Pradesh, Rajasthan and Maharashtra. Soybean sowing regions of Maharashtra, such as Marathwada, and Karnataka are also facing drought-like situation.
“Plants have started growing pale in the field due to the deficiency of moisture in major growing areas of Madhya Pradesh. (The) Situation is somewhat similar in other states including Maharashtra and Andhra Pradesh,” said Davish Jain, chairman of Indore-based Soybean Processors Association of India (Sopa). “So, the increase in acreage will be nullified by lower yield, resulting into overall soybean output similar to last year. The output may even decline if rainfall does not take place in the next seven to ten days.”
In its latest assessment, Sopa has estimated that crop condition in 12% of the total coverage area is ‘very poor’, while another 17% is ‘stressed’. About 60% of growing area is normal, 12% ‘good’, but only 6% has been labeled ‘very good’.
“Owing to lack of rains after sowing, weedicide could not be sprayed, leading unusual growth of weeds in some areas resulting into attack of inspects and pests. Except for Malwa and Nimar regions of Madhya Pradesh and some areas of Marathwada in Maharashtra, the crop condition is normal. Soybean crop in the country still needs one or two rains for a normal yield,” said Jain.
Following the deficient rainfalls forecast this monsoon season, soybean price surged to Rs 4,200 a quintal in April-May after moving in a thin range of Rs 3,300-Rs 3,470 a quintal between January and April. The oilseed later fell sharply to touch Rs 3,200 a tonne in spot market
In futures, however, soybean for delivery in October slumped to Rs 3113 a quintal early September despite reports of deficient rainfalls from the level of Rs 3576 a quintal in May. Following reports of gradual receding of monsoon, however, the oilseed price started recovering to trade currently at Rs 3274 a quintal on September 7 on the benchmark National Commodity & Derivatives Exchange (NCDEX).
“Bullish sentiments are currently appearing among the market participants on reports of infestation of pests in Madhya Pradesh and fear of poor monsoon progress during September. Moreover, in September US Department of Agriculture (USDA( report, there is possibility soybean output revising downwards and increase trade of soybean which may have bullish impact and the prices may surge to Rs 3400 / 3630 per quintal levels for short term,” said Ritesh Kumar Sahu, Research Analyst with Angel Commodities Broking.
“However,” he added, “we expect the soybean prices to touch Rs. 3,000 per quintal and trade in the range of Rs 2,900 – 3100 a quintal once the arrivals start in spot market across the country during October-November.”
The USDA forecasts India’s soybean output at 11.5 million tonnes in 2015-16 as against 10.5 million tonnes estimated by India’s Ministry of Agriculture for 2014-15. Meanwhile, stockists have started offloading their holding ahead of the new season harvest. Still, experts forecast, around 1.0 – 1.5 million tonnes of soybean would be carried out for next season.
| Annual production | Year Output (million tonnes) |
| 2015-16* | 10.5 |
| 2014-15 | 10.5 |
| 2013-14 | 11.86 |
| 2012-13 | 14.67 |
| 2011-12 | 12.21 |
| 2010-11 | 12.74 |
| 2009-10 | 9.96 |
| 2008-09 | 9.91 |
(Source: Ministry of Agriculture, * Trade estimate)