Slow progress of monsoon likely to cause a delay in the sowing of oil seeds amid the Kharif season, said the Solvent Extractors Association of India (SEA), the potential impact of the likely El Nino condition on crop production was also mentioned. According to the industry body, the area sown to oilseeds has remained lower this year, with 4.1 lakh hectares sown compared to 4.8 lakh hectares during the same period last year. Ajay Jhunjhunwala, representing the SEA, pointed out that the delayed onset of monsoon in Kerala, coupled with slow advancement in other states, has resulted in the delayed sowing.
While the India Meteorological Department (IMD) has forecast near-normal monsoon conditions, Jhunjhunwala cautioned that the possibility of El Nino should not be disregarded entirely. He noted that if El Nino occurs, it could negatively impact the Kharif crop and the domestic availability of vegetable oils in the upcoming oil year 2023-24.
Jhunjhunwala emphasized the importance of ensuring minimum support prices (MSP) for farmers. Although the government's move to support farmers with MSP is welcomed by the SEA, Jhunjhunwala stressed the need for the government to defend MSP effectively.
The current market prices for certain oilseeds are quoted below their respective MSPs. For instance, rapeseed is being quoted at Rs 5,100 per quintal against an MSP of Rs 5,450 per quintal, while sunflower seed prices in Haryana are below the MSP of Rs 6,400 per quintal, leading to farmer protests.
Jhunjhunwala also highlighted the discouragement among mustard farmers due to the significant drop in prices. At the time of sowing in October 2022, prices were quoted at Rs 7,000-7,500 per quintal, but currently, farmers are receiving only Rs 4,700-4,800 per quintal. This may result in lower acreage under soybean during the Kharif season and mustard in the rabi season, affecting overall oilseed production.
India's dependency on vegetable oil imports is evident from the data provided by the SEA. The country imported 91.68 lakh tonnes of vegetable oil in the first seven months of this year until May, marking an 18% increase compared to the previous year's import volume of 77.68 lakh tonnes.
The slow progress of the monsoon and concerns regarding the potential impact of El Nino on oilseed production have raised apprehensions about the supply of vegetable oils and the need to support farmers through MSP and other measures.
