The Hindu Business Line : Castor output seen up 12% on 11 pc increase in acreage

AN 11 per cent increase in area planted under castorseed (8.73 lakh hectares) has resulted in a 12 per cent rise in output to 9.16 lakh tonnes for 2005-06, according to crop survey sponsored by the Solvent Extractors' Association of India (SEAI).

The crop figures were announced by the survey agency AC Nielsen ORG-MARG for the benefit of over 300 participants at the fourth international seminar on castorseed, oil and value-added products held at Rajkot, Gujarat, last weekend.

With 5.71 lakh tonne (lt) output, Gujarat was the principal producer followed by Andhra Pradesh at 1.64 lt and Rajasthan 1.46 lt. Both trade estimate (8.7 lt) and Government estimate of the crop announced sometime in November last was less than 9 lt.

The Chairman of International Castor Oil Association, Mr P.H. Bolomey, said Brazil was set to produce more castorseed for use in bio-diesel and that a part of incremental output would flow into production of traditional castor-based products. Recent upswing in mineral oil prices has encouraged governments to look for cheaper cleaner fuel, he asserted.

Regretting the volatility in castor market, Mr Bolomey said price stability was key to sustained industrial demand and violent price fluctuations unsettled the user industry.

Mr Liv Severino from Brazilian Agricultural Research Organisation pointed out to the constant mismatch between castor output and industry needs and said Brazil was in a decisive moment whether or not to use castor for bio-diesel. According to the researcher, the next two years may unravel the future of castor's role in bio-diesel.

Experts broadly agreed that there was an upside for both castorseed and oil prices. Export price of castor oil from the country could potentially rise by about $100 a tonne from $650 a tonne free-on-board.

Some tightness in supplies was not ruled out.

Although global demand was somewhat static, overseas buyers had covered roughly 80 per cent for the first half, while the second half was left substantially uncovered and there was plenty of business to be done for the second half in, it was stated.

According to SEAI, castor oil exports during April-December 2005 totalled 1.38 lt valued at Rs 492 crore compared with 1.54 lt worth Rs 598 crore corresponding period previous year. China has emerged as a significant buyer with purchases of over 60,000 tonnes.