Shift to cotton reduces oilseed acreage by 6%

The diversion from oilseeds to cotton has resulted in a lower acreage of oilseeds by about 6 per cent this year to 153 lakh hectare from 163 lakh hectare in the last oil season. The sowing for kharif oilseeds starts in June and the harvesting begins in October.

The lower acreage would translate into a loss in output of oilseeds by 6 per cent at 158 lakh tonne this year as against the previous year's output of 168 lakh tonne, considering a productivity of roughly 950 kg a hectare, said B V Mishra, executive director, Solvent Extractors' Association (SEA).

However, the low output has not impacted the prices of oilseeds as steeply as those of other essential commodities. The rise in prices of oilseeds has been the least as compared to that of other essential commodities, opined A R Sharma, president, SEA.

"Had the prices of oilseeds and oil moved at the same pace as that of other essential commodities, edible oils would have been in the range of Rs 90 to Rs 100 a kg as against Rs 40 to Rs 50 a kg now," he added.

The loss in acreage is mainly attributed to lower sowing of groundnut, which has plunged from 53.54 lakh hectare to 43.23 lakh hectare, mainly on account of drought in Andhra Pradesh. The Rayalaseema region of the state was virtually under a dry spell throughout July.

In Andhra Pradesh, the acreage under groundnut is down from 14.58 lakh hectare to 8.49 lakh hectare, while Gujarat has seen a decline from 18.08 lakh hectare to 16.55 lakh hectare, as farmers shifted from groundnut to cotton.

In contrast, the acreage of soybean has gone up from 76.10 lakh hectare to an all-time high of 79.53 lakh hectare. Soybean crop in Maharashtra and Madhya Pradesh were damaged marginally, but the actual loss is yet to be assessed.

The increase in soybean acreage, however, does not make up for the loss of acreage of groundnut, as the oil content of soybean is just about 19 per cent compared to that of 45 per cent in the case of groundnut.

The acreage under sunflower has increased marginally from 7.12 lakh hectare to 7.49 lakh hectare last year, while that of sesame reduced to 15 lakh hectare from 15.86 lakh hectare last year.

The recent rains in Rajasthan, which contributes about 9 per cent of the edible oil consumption, is expected to prove a boon for oilseeds in the state.

SEA has asked the government to direct Nafed to dispose at least 5 to 7 lakh tonne of mustard seeds every month between August and October, which can be crushed and can provide an additional 2.5 to 3 lakh tonne of rapeseed oil every month. This will check the rising domestic prices and the import of edible oil.

At the same time, Nafed can reduce the burden of stock being held by SEA at the best possible price. It can also provide raw material to the industry and increase the exports of rapeseed extractions, it added.