The Hindu Business Line : Soyabean rust posing threat to US

THE seriousness of the Asian soyabean rust threat to the forthcoming American soyabean crop is now becoming increasingly clear so much so that Washington believes the disease could permanently alter the country's agricultural scenario.

Indeed, the problem can change the way business is done. It has the potential to send the global oilseeds market into a tailspin with serious long-term consequences. Until a remedy is found, any reduction in US crop size is sure to send oilseeds and vegetable oil prices soaring, even while injecting a fresh challenge to the ongoing efforts to divert larger volumes of vegetable oils for non-food purposes, especially bio-fuel.

For major importers such as China and India, the rust problem in the US is sure to aggravate existing concerns and bring about a change in the composition of the import basket. The beneficiary would of course be palm oil.

The US is the world's largest producer of soyabean with 2004-05 output reaching a new high of 85.5 million tonnes (mt) representing close to 40 per cent of the global production of 228.6 mt. It is also the largest exporter of the oilseed with an annual average of 27 mt. Global soyabean exports are about 62 mt.

While South America (mainly Brazil, Argentina) has been facing the disease menace for the past several years, it was as late as November 2004 that the problem was detected in the North American continent. As of now, in at least nine states the incidence of rust has been found.

Soyabean varieties resistant to the disease are currently not available. If left untreated, the highly pathogenic disease can cause severe losses through plant defoliation. Use of an array of fungicides over time has proven to be the most effective damage control exercise in South America.

While scientists and others are trying to grapple with the issue, some soyabean acreage could switch to other crops, especially in areas with the highest risk of outbreaks. It is only a matter of weeks to go before the farmers start to plant soyabean. How they would respond, in terms of acreage allocation, to the rust threat remains to be seen.

Soyabean rust brings with it an uncertain potential for lower soyabean production in the future that could raise prices and reduce domestic crush and exports, USDA cautioned.

The flip side to this is that Indian soyabean could get a boost. Currently, India is world's fifth largest producer of soyabean. However, Indian yields are abysmally low at less than one tonne per hectare whereas the world average is 1.8 t/ha and in the US it is 2.7 t/ha.

It is, therefore, with a renewed sense of urgency that efforts to raise oilseeds productivity in the country have to be pursued.

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Soyabean rust posing threat to US