The Hindu Business Line : Global oilseeds output to touch 360 mt next year

WITH global supply unable to keep up with rising demand, world oilseeds production is expected to rise 5 per cent to 360 million tonnes (mt) during 2004-05 (July-June).

Production is anticipated to rise mainly from increase in area under oilseeds in response to the demand and higher prices, according to an Australian Bureau of Agriculture and Resource Economics (Abare) report.

Consumption, according to the report, is expected to increase 4 per cent to 359 mt with China and India showing more appetite on rise in personal incomes. Moreover, domestic production in both the countries has been unable to meet the demand. Soyabean import is likely to rise sharply in China.

Increased demand for processed food would lead to need for more vegetable oils, and improved income outlook in developing nations, such as India and China, was likely to lead to a continuation of the demand trend, it said.

"Higher demand for meat and poultry products is also expected to result in further demand growth for oilmeals," the report said.

On the production front, Abare said in its Outlook 2004 report: "Further increases to area planted to soyabeans in Brazil and Argentina are expected for the coming year, with consequent rises in production and export availabilities."

"It is a sunrise as far as oilseeds sector is concerned for the next 10 years," Mr Tony Day of Cargill Australia told the Abare Outlook Conference. "Supply will be unable to keep up with demands for fats," he said.

Currently, Brazil and Argentina account for nearly 56 per cent of the total soyabean crop in the world, with the US making up 41 per cent. On the exports front, Brazil and Argentina together garner a market share of 57 per cent versus 42 per cent of the US.

The outlook said the growth rate of global palm oil, the cheapest among oils, was expected to slow during 2004-05 on maturation of areas under palm combined with the recent El Nino effect that had reduced moisture levels in Malaysia and Indonesia.

Both these nations account for 83 per cent of global palm oil production and El Nino is an effect that causes drought due to rise in ocean temperature, originating from the Pacific Ocean.

Cottonseed, which accounts for 11 per cent of world oilseeds production, is projected to rise on sharp rise in cotton prices. Production is also forecast to rise in canola/rapeseed and sunflower.