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Even as the sowing of kharif oilseeds has increased over last year, the trade is expecting higher oilseed availability, resulting in a rise in domestic edible oil production, but with no impact on imports.
As per the latest data shared by the Solvent Extractors’ Association of India (SEA), India’s overall kharif oilseeds production is projected at 178.25 lakh tonnes (lt) for 2016-17 against 126 lt last year.
Edible oil production is estimated at 7.28 million tonnes (mt) for the oil year 2016-17 (November-October) against 5.80 mt last year.
The increase in oilseeds output is attributed to the higher yield of 936 kg per hectare as against 680 kg/ha. Acreage has increased from 185.19 lakh hectares to 190.31 lakh hectares.
“There will be ample availability of edible oils as we expect about 1.2-1.5 million tonnes of extra oil production this year. However, this will not compensate imports, so the imports are likely to remain more or less at the same level,” said BV Mehta, Executive Director, SEA.
Mehta attributed the growth in demand to the GDP expansion — estimated at 7.1 per cent — and double-digit growth in out-of-home consumption of edible oils. Even with a moderate population growth, the absolute increase in the number of people will be quite high.
“Due to a lower consumption base, demand could grow at 4-5 per cent in the long run. By 2025, India may consume 30-34 million tonnes. Consumption and import of soft oils like soyabean oil and sunflower oil is rising with their demand and fall in domestic production,” said Mehta.
In 2016-17, total domestic edible oil production is estimated to come in at 7.28 mt against 5.80 mt last year.
For the 2016-17 oil year total edible and non-edible oil imports are expected to hover around 14.5 mt (14.73 mt).
Rice bran oil production is likely to increase marginally to 980,000 tonnes from 950,000 tonnes last year, while local palm oil production is estimated to be at 2.30 lakh tonnes for the current year.
According to trade sources, the premium on sunflower oil over soyabean oil has been wiped out and it is now available at a discount to soyabean oil.
“This year due to the bumper crop of sunflower seeds in the Ukraine and other East European countries, sunflower oil is cheaper by $60-70 per tonne compared to soyabean oil,” Mehta added.
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