India soy output seen intact despite acreage dip

 

 

Indian famers may cut the area under cultivation for soy in 2010-11 on falling prices, but better yields may result in steady output from a year ago, officials said.

 

Some of the area previously growing soy may be diverted to pulses, cotton and sugarcane which gave significantly better returns last year, according to B.V. Mehta, executive director of the Solvent Extractors' Association of India.

 

"Farmers are less interested in soy as it gave lower returns. We are estimating a drop of 5% in acreage this year," he added. In 2009-10 farmers had planted the oilseed on 9.612 million hectares, according to farm ministry data.

 

Soy prices in various major spot markets were hovering just above Rs1,900 per 100 kg, sharply lower compared to about Rs2,500 in June 2009. Most Indian farmers begin cultivation of soy in June.

 

The states of Madhya Pradesh in central India, Maharashtra in the west and Andhra Pradesh and Karnataka in the south, are major producers of soy.

 

Traders said that per hectare yields fell sharply last year due to drought. This year if rains come on time, output will remain steady at last year's level or even on higher side despite a drop in acreage, traders said.

 

India's weather office has forecasted a normal June-September monsoon this year, but industry watchers say its spread is more important for sowing and will determine the yields.

 

Soy is largely a rain-fed crop, especially in Madhya Pradesh and Maharashtra, the top two producers.

 

Meanwhile, the Central Organisation for Oil Industry and Trade estimates soy output in 2009-10 fell by 4.4% to 8.5 million tonnes as weakest monsoon in nearly four decades cut yields.

 

As of June 4, acreage under summer-sown oilseeds in the country stood at 837,000 hectares, down 34% compared to 1.27 million hectares in the same period last year.