Report Highlights:

For (marketing year) MY 2014/15, total oilseed production is expected to decrease by 3.4 percent to 36.5 million metric tons (MMT) on lower kharif (fall and early harvested) area due to poor weather. Below-normal rains, high temperatures, and less water availability from major reservoirs reportedly slowed kharif (fall and early harvested) crop planting progress; this is expected to affect negatively both rainfed and irrigated crop production. MY 2014/15 total edible oil imports are estimated at 12.3 MMT, up 12 percent on competitive international prices, growing demand from middle class consumers, and lower domestic oilseed supplies.

Total Oilseed Production to Fall by 3.4 Percent due to Deficient Rainfall; Peanut Production Most Affected by Poor Monsoons

For (marketing year) MY 2014/15 (October to September), total oilseed production is expected to decrease by 3.4 percent to 36.5 million metric tons (MMT) on lower kharif (fall and early harvested) area due to poor weather. Below-normal rains, high temperatures, and less water availability from major reservoirs reportedly slowed kharif crop planting progress; this is expected to affect negatively both rainfed and irrigated crop production. 

For MY 2014/15, soybean production is unchanged at 10.6 MMT assuming normal rainfall for the rest of the planting season (August to September). For MY 2013/14, Post lowered soybean production by 4.5 percent to 10.5 MMT on inadequate rainfall. As of August 21, 2014, according to Ministry of Agriculture (MOA) statistics, total soybean acreage dropped 10 percent to 10.9 million hectares as compared to last year. Moreover, reportedly, soybean acreage fell in major growing states, such as Maharashtra and Madhya Pradesh (acreage fell by 8.2 percent and 10.4 percent), because many farmers switched to other crops on expectations of higher profit margins. These alternative crops included cotton, coarse cereals, green forage, and other vegetables. MY 2014/15 total sunflower area and production levels are revised down to 650,000 hectares and 600,000 metric tons, respectively, on poor weather. According to the latest MOA planting report, kharif sunflower has only been planted on 165,000 hectares, 22 percent less than last year. 

MY 2014/15 peanut area and production levels are lowered to 4.47 million hectares and 5.2 MMT, respectively, on lackluster rainfall. Because of below-normal rains in major producing states such as Gujarat and Andhra Pradesh (26 and 15 percent less acreage than last year), MOA estimates kharif peanut acreage at 3.5 million hectares, down 14 percent from last year. 

Approximately 70 percent of peanut is produced during the kharif season. 

According to the Indian Meteorological Department (IMD), more rainfall is expected in the coming months, which may provide relief to some rain deficient areas. However, expectations are that cumulative rainfall will be less than the long-period average, which is based on data from 1950 to 2000. 

Total Edible Oil Imports to Surge on Low Oilseed Production 

For MY 2014/15, Post estimates total oilseed crush to decline five percent to 28.3 million on low oilseed production. MY 2014/15 total edible oil imports are estimated at 12.3 MMT, up 12 percent on competitive international prices, growing demand from middle class consumers, and lower domestic oilseed supplies. MY 2013/14 edible oil imports were revised up marginally to 11 MMT on higher than anticipated import pace. 

Uncompetitive Export Prices to Limit Oil Meal Exports In MY 2014/15, total oil meal exports are lowered to 4.8 MMT on less exportable supplies and low production. For MY 2013/14, total oil meal exports (which exclude rice bran and castor meal) are revised down 17 percent to 4.4 MMT due to uncompetitive prices. Oil meal exports include 3.4 MMT of soymeal and 1 MMT of rapeseed meal