Post revises down rapeseed and mustard production for marketing year (MY) 2014/15 (October-September) by 400,000 metric tons (MT) to 7.1 million metric tons (MMT). This revision reflects a nine-percent decline in area planted which will reach 6.51 million hectares. Despite the expected decline in area planted, Post forecast yields will be five percent higher than the previous estimate, which will partially offset lower area planted.

Higher Yields Will Partially Compensate for the Decline in Area Planted for Rapeseed and Mustard in MY 2014/15

Post revises down its rapeseed and mustard production forecast for MY 2014/15 by 400,000 MT to 7.1 MMT. This revision is due to an unanticipated nine-percent decline in area planted, which will reach 6.51 million hectares in MY 2014/15. Yields are increased by five percent over the previous estimate and will partially compensate for the decline in area planted.

Net Decline in Area Planted

Rajasthan, which produces about 40 percent of India's rapeseed and mustard, experienced an area planted decrease of 410,000 hectares, a 13 percent drop from last year. Conversely, area planted in Madhya Pradesh decreased by 151,000 hectares, a 19 percent decline from last year. Incremental rises in area planted in Uttar Pradesh, West Bengal, Assam, and Telangana was not enough to compensate for the unexpected decreases in area planted in Rajasthan and Madhya Pradesh.

Warm Temperatures in October Discouraged Additional Planting

Warmer than optimal temperatures during the rabi (winter sown) crop planting season in northwestern India discouraged northwestern farmers from planting additional oilseed crop acres. An estimated 55 percent of India's total rabi oilseed area is located in that region. More generally, area planted for all major rabi season crops, to include wheat, rapeseed, mustard, and gram have decreased. This reduction in rabi area planted is largely due to deficit 2014 southwest monsoonal rainfall and the subsequent reduction in ground and irrigation water, as well as the warmer temperatures.

Taramira (Eruca sativa) Oilseed Area in Rajasthan Dropped 46 Percent From Last Year

Area planted under taramira, an Indian oilseed crop, particularly in Rajasthan, declined from 300,000 hectares in MY 2013/14 to 160,000 this year,. Marginal lands, which are often unsuitable for cereal crop production, are typically used for profitable cultivation of taramira. Taramira yields are typically lower than rapeseed and mustard. Many farmers switched a portion of their cultivable land to shorter-duration horticultural crops, coriander, gram, and barley a small minority chose to keep their land fallow. . Favorable Weather Will Boost Yield of Rainfed Rapeseed and Mustard Crop

Rapeseed and mustard are sturdy winter crops and over 50 percent of India's rapeseed and mustard area is rainfed. These areas are expected to see more robust yields due to (unusually) favorable weather conditions throughout the growing period, particularly following the October 2014 planting period. Additionally, below average incidences of insect and pest damage, coupled with timely winter rains will support crop yields. Post expects yields to increase over the previous estimate and will partially compensate for the net decline in area planted.

Planting Higher than Last Five-Year Average

Inspite of lower rapeseed and mustard planting, the total area planted is higher than the most recent five-year average of 6.2 million hectares. Even in Rajasthan, the area planted (2.64 million hectares) is higher than its five-year average of 2.5 million hectares.

Strong Market Prices Assisted Planting Intention

During the past 12 months, rapeseed and mustard wholesale prices have risen by more than eight percent to the current levels of INR 3,500-3,550 per quintal. Strong market prices, particularly during first quarter of MY 2014/15, have encouraged planting. In addition to favorable market prices, farmer were further encouraged to plant rapeseed and mustard because the MSP for rapeseed and mustard was raised by INR 50 in MY 2014/15 to INR 3,100 per quintal.

Rapeseed and Mustard Crop Has Reached Maturity/Advanced Stage of Maturity

Industry experts believe that heavy late-season heavy precipitation in February over India's major rapeseed and mustard production regions are unlikely to affect yields, as most crops have reached maturity or are already in advance stage of maturity. However, Post sources note that some late-planted crops, which are less developed, could be negatively impacted by late rains. However, the percentage of late-planted rapeseed and mustard is expected to be relatively smaller this year.

India: Rapeseed, PSD

(Area in 1000 hectares and production in 1000 metric tons)

Oilseed, Rapeseed

2012/2013

2013/2014

2014/2015

Market Begin Year

Oct 2012

Oct 2013

Oct 2014

India

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Planted

6,750

6,730

6,800

7,130

6,600

6,517

Area Harvested

6,750

6,730

7,130

6,850

6,600

6,517

Beginning Stocks

729

827

569

685

519

603

Production

6,800

6,800

7,300

7,300

6,850

7,100

MY Imports

0

20

0

20

0

20

MY Imp. from U.S.

0

0

0

0

0

0

MY Imp. from EU

0

0

0

0

0

0

Total Supply

7,529

7,647

7,869

8,005

7,369

7,723

MY Exports

0

2

0

2

0

2

MY Exp. to EU

0

0

0

0

0

0

Crush

6,000

6,000

6,300

6,300

6,200

6,200

Food Use Dom. Cons.

660

660

750

750

650

800

Feed Waste Dom. Cons.

300

300

300

350

200

330

Total Dom. Cons.

6,960

6,960

7,350

7,400

7,050

7,330

Ending Stocks

569

685

519

603

319

391

Total Distribution

7,529

7,647

7,869

8,005

7,369

7,723

CY Imports

0

0

0

0

0

0

CY Imp. from U.S.

0

0

0

0

0

0

CY Exports

0

0

0

0

0

0

CY Exp. to U.S.

0

0

0

0

0

0

India: Meal, Rapeseed, PSD

(Units in 1000 metric tons, Extraction rate in Percent)

Meal, Rapeseed

2012/2013

2013/2014

2014/2015

Market Begin Year

Oct 2012

Oct 2013

Oct 2014

India

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Crush

6,000

6,000

6,300

6,300

6,200

6,200

Extr. Rate, 999.9999

0.5900

0.5900

0.5905

0.5905

0.5903

0.5903

Beginning Stocks

21

402

30

592

20

441

Production

3,540

3,540

3,720

3,720

3,660

3,660

MY Imports

0

0

0

0

0

0

MY Imp. from U.S.

0

0

0

0

0

0

MY Imp. from EU

0

0

0

0

0

0

Total Supply

3,561

3,942

3,750

4,312

3,680

4,101

MY Exports

901

750

1,327

1,071

1,000

1,200

MY Exp. to EU

2

0

2

0

2

0

Industrial Dom. Cons.

0

0

0

0

0

0

Food Use Dom. Cons.

0

0

0

0

0

0

Feed Waste Dom. Cons.

2,630

2,600

2,403

2,800

2,660

2,800

Total Dom. Cons.

2,630

2,600

2,403

2,800

2,660

2,800

Ending Stocks

30

592

20

441

20

101

Total Distribution

3,561

3,942

3,750

4,312

3,680

4,101

CY Imports

0

0

0

0

0

0

CY Imp. from U.S.

0

0

0

0

0

0

CY Exports

882

800

1,200

800

1,000

800

CY Exp. to U.S.

0

0

0

0

0

0

SME

1,871

1,850

1,710

1,992

1,893

1,992

India: Oil, Rapeseed, PSD

(Unit in 1000 metric tons and Extraction rate in Percent)

Oil, Rapeseed

2012/2013

2013/2014

2014/2015

Market Begin Year

Oct 2012

Oct 2013

May 2014

India

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Crush

6,000

6,000

6,300

6,300

6,200

6,200

Extr. Rate, 999.9999

0.3917

0.4100

0.3968

0.4097

0.3952

0.4100

Beginning Stocks

158

225

114

181

167

192

Production

2,350

2,460

2,500

2,581

2,450

2,542

MY Imports

8

8

160

0

250

150

MY Imp. from U.S.

0

0

0

0

0

0

MY Imp. from EU

0

0

0

0

0

0

Total Supply

2,516

2,693

2,774

2,762

2,867

2,884

MY Exports

2

2

2

0

2

2

MY Exp. to EU

0

0

0

0

0

0

Industrial Dom. Cons.

60

60

70

70

80

75

Food Use Dom. Cons.

2,340

2,450

2,535

2,500

2,650

2,600

Feed Waste Dom. Cons.

0

0

0

0

0

0

Total Dom. Cons.

2,400

2,510

2,605

2,570

2,730

2,675

Ending Stocks

114

181

167

192

135

207

Total Distribution

2,516

2,693

2,774

2,762

2,867

2,884

CY Imports

50

0

50

0

50

0

CY Imp. from U.S.

0

0

0

0

0

0

CY Exports

2

0

2

0

2

0

CY Exp. to U.S.

0

0

0

0

0

0

Oil meals

Indian oilmeal exports were down 56 percent to less than 1 million MT in first four months of MY 2014/15. Sluggish soybean meal exports dragged total soybean meal exports to one-third of total sales made during the corresponding period last year. Moreover, Indian millers are discouraged by a glut of low-cost vegetable oil imports (mostly palm) and low international demand for Indian soybean meal. Concurrently, Post revised up total oilmeal export estimate (road + high-sea sales) in MY 2013/14 from 3.9 MMT in to 4.1 MMT to include road/surface transport of rapeseed meal. An estimated 250,000 MT of rapeseed meal was exported to neighboring countries last year.

India: Oilmeal Exports, Metric Tons

Soybean meal

Rapeseed meal

Peanut meal

Sunflower meal

Total

Oct-13

29,071

140,393

263

0

169,727

Nov-13

110,806

39,133

395

0

150,334

Dec-13

193,832

129,707

0

0

323,539

Jan-14

104,426

44,361

0

0

148,787

Road Transport*

200,000

-

-

Oct 14-Jan-15

638,135

353,594

658

0

992,387

Oct 13-Jan-14

1,951,750

320,923

1,243

0

2,273,916

% Change

-67

10

-47

-56

Vegetable Oils

Vegetable oil imports, mostly crude palm oil (CPO), rose 19 percent to 4.6 MMT during the first four months of MY 2014/15. Indian importers were encouraged to increase stocks of vegetable oil due to lower than anticipated domestic oilseed production, as well as the availability of low-cost palm oil from Indonesia and Malaysia. As a result, vegetable oil stocks grew by more than 2 MMT in January 2015, a notable increase over the 1.5 MMT imported in January 2014. Indonesia and Malaysia eliminated export duty on CPO, as well as maintained zero and/or low export duties on other value-added palm products. As a result, CPO processing was reduced in those countries and pushed additional CPO exports to India.

India: Vegetable Oil Imports, in 1000 Metric Tons

Oct-14

Nov-14

Dec-14

Jan-15

Oct 14- Jan 15

Oct 13 - Jan 14

% Change

RBD palm olein

143

56

45

70

314

735

57

Crude palm oil

712

713

779

581

2,785

2,193

27

Crude palm olein

0

779

0

0

0

0

Crude Palm kernel oil

10

581

13

8

58

47

23

Total palm oil

866

797

836

659

3,157

2,975

6

Crude soybean oil

219

121

97

224

661

340

95

Refined soybean oil

0

0

0

0

0

0

0

Total soy oil

219

121

97

224

661

340

95

Crude sun oil

101

194

152

156

603

482

25

Refined sun oil

0

0

0

0

0

0

0

Total sun oil

101

194

152

156

603

482

25

Canola Rape oil

45

37

36

44

162

58

180

Cottonseed Oil

0

0

0

0

0

0

0

Safflower oil

0

0

0

0

0

1

100

Coconut oil

0

0

0

0

0

0

Grand Total

1,230

1,149

1,122

1,083

4,584

3,856

19