The soybean acreage could fall by about 5 per cent to about nine million hectares in the coming kharif season due to competition from other crops and expectation of lower realisation by farmers, an industry body said today.
However, soybean production is expected to increase or remain at last year's level if the monsoon is good.
"The area might reduce a little bit, say by 5 per cent on the whole, due to competition from crops like cotton and pulses. Another reason that can cause soybean acreage to decline is that farmers are not expecting high prices," Soybean Processors Association of India (SOPA) co-ordinator Rajesh Agarwal said.
Soybean, grown in the kharif season starting next month, was sown over 9.67 million hectares during the 2009-10 crop year, as per SOPA.
Agarwal pointed out that though farmers received Rs 2,200-2,700 for a quintal of soybean last year, they are unlikely to realise this much this time due to higher global output.
"These are not the rates farmers will see this year because the international crop is very good. Lower realisation, of about Rs 1,800-1,900 per quintal, is what is weighing on farmers' minds and this may bring the acreage down," he said.
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Brazil and Argentina, the biggest producers of soybean, have produced seven million tonnes more oilseed this year, which is likely to put downward pressure on prices in global as well as Indian markets, he said, adding, "This is sure to have an impact on price realisations of Indian farmers."
When asked about the impact of lower acreage on output, Agarwal said that if the rains are good, production will be equal or higher than last year's level -- irrespective of the marginal drop in area -- as yields would improve.
Due to the late arrival of monsoon last year, which resulted in late planting, soybean productivity is estimated to have declined to 1,006 kg per hectare against 1,124 kg per hectare during the kharif season 2008-09.
According to SOPA data, soybean production in the country is estimated at 9.72 million tonnes in 2009-10. However, government data pegs the output higher at 10.54 million tonnes.