1.0 Present Status of Oilseed crops and vegetable oils in ...

1.0 Present Status of Oilseed crops and vegetable oils in India

Oilseed crops are the second most important determinant of agricultural economy, next only to cereals within the segment of field crops. The self-sufficiency in oilseeds attained through "Yellow Revolution" during early 1990's, could not be sustained beyond a short period. Despite being the fifth largest oilseed crop producing country in the world, India is also one of the largest importers of vegetable oils today. There is a spurt in the vegetable oil consumption in recent years in respect of both edible as well as industrial usages.

The demand-supply gap in the edible oils has necessitated huge imports accounting for 60 per cent of the country's requirement (2016-17: import 14.01 million tonnes; cost Rs. 73,048 crore). Despite commendable performance of domestic oilseeds production of the nine annual crops (Compound Annual Growth Rate of 3.89%), it could not match with the galloping rate of per capita demand (~6%) due to enhanced per capita consumption (18 kg oil per annum) driven by increase in population and enhanced per capita income.

1.1 Sources of vegetable oils

Primary sources of vegetable oil: Nine oilseeds are the primary source of vegetable oils in the country, which are largely grown under rainfed condition over an area of about 26 million ha. Among these, soybean (34%), groundnut (27%), rapeseed & mustard (27%) contributes to more than 88% of total oilseeds production and >80% of vegetable oil with major share of mustard (35%), soybean (23%) and groundnut (25%).

Andhra Pradesh (groundnut) & Gujarat (groundnut), Haryana(Mustard), Karnataka(G.nut), M.P(Soybean), Maharashtra(Soybean), Rajasthan (Mustard & Soybean), Tamil Nadu(G. nut), U.P(Mustard), West Bengal(Mustard) contributing more than 95% of total oilseed production in the country. India is producing about 7-8 million tones of vegetable oils from primary sources

Secondary sources of vegetable oil: In addition to nine oilseeds, 03 million tonnes of vegetable oil is being harnessed from secondary sources like cottonseed, rice bran, coconut, Tree Borne Oilseeds (TBOs) and Oil Palm. Oil palm which is categorized as secondary sources of oils should be included as primary source as it gives the highest per ha oil yield (4-5t/ha).

1.2 Area, Production and Yield of Oilseed Crops in India

In India, annual oilseeds are cultivated over 26.67 million hectares of area producing 30.06 million tonnes annually (quinquennium ending 2016-17) (Fig 1. and Table 1). Majority of the oilseeds are cultivated under rainfed ecosystem (70%). The area under oilseeds has experienced a deceleration in general, and this is due to their relative lower profitability against competing crops like maize, cotton, chickpea etc., under the prevailing crop growing and marketing situations.

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Fig 1: Trends in area, production and yield of annual oilseeds in India (2000-2017)

Area (mill.ha)

Prodn (mill.tonnes)

40

1400

35

1200

30

1000

25

800

20

15

600

10

400

5

200

0

0

2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17

Source: DFI Committee Estimates based on data compiled from DACNET

1.3 Growth rate of oilseed crops:

The growth rates of all annual oilseed crops during past decade (2001-02 to 2011-12) is poor (negative for area and production) especially for sunflower, safflower, linseed, niger; and negative for area of groundnut. Soybean and castor crops have registered positive and high growth rates and rapeseed-mustard registered higher rate of production. The higher productivity driving the production (and profitability) and area expansion of castor is the best situation for oilseeds. The annual production of is increasing continuously in the country and showed a positive growth during the period 2001 to 2013 compared to the decade 1990-2000 especially as the increased production has come from the increase in area and highest rate of increase for productivity implying the technology led growth. Increase of area by 1.8 times , production by 4.99 times and yield by 2.86 times over 1966-67( Table 1).

Table 1. Growth in XII Plan over XI Plan

Crops

Per cent increase/decrease Area Yield Production

Castor

+11.10 +16.00

+27.00

Linseed

-24.60 +20.80

-7.72

Niger

-29.58 +15.10

-18.80

Groundnut

-14.00 +13.40

-2.44

Sesame

-7.70 +13.50

+5.00

Rapeseed & Mustard

+0.23 +7.20

+7.40

Soybean

+18.00 -10.00

+6.24

As per trends, vegetable oil production is around 7.0 million tonnes from about 30.0

million tonnes of oilseeds necessitating import to the tune of 10-14 million tonnes, accounting

for about 60 per cent of the total (Table 2).

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Table 2: Estimated domestic production, import and total availability of edible oils during last 3 years (November to October) (Quantity in lakh tonnes)

Vegetable oils

R-M Soybean Ground nut

2014-15

2015-16

Oils Oilseeds Oils Oilseeds

Primary source (A)

19.47 62.82 21.08

67.97

16.6 103.74 13.73

85.70

17.02 74.02 15.27

67.33

2016-17

Oils

Oilseeds

24.74 22.10 17.16

79.77 137.94 75.65

Sunflower

1.43 4.34 0.98

2.96

0.80

2.41

Sesame Niger seed Safflower Castor

2.57 8.68 2.65 0.23 0.76 0.21 0.27 0.90 0.15 7.48 18.70 6.16

8.50 0.74 0.53 17.52

2.45

7.84

0.24

0.83

0.22

0.78

4.99

14.21

Linseed

0.47 1.55 0.32

1.25

0.39

1.54

Sub-total (A)

Coconut Palm oil Cotton seed

65.54

4.80 1.71 12.15

275.51 60.55

252.50

Secondary source (B)

4.32

1.98

10.05

73.09

5.32 2.30 12.24

320.97

Rice bran

9.20

9.90

10.31

SEO

3.00

3.50

2.85

Tree & Forest origin 1.60

1.50

1.50

Sub Total

32.46

31.25

34.40

Total (A+B)

Less exports & Industrial use

5.94

5.50

6.50

NDA of edible oils 92.06

Import of edible oils 138.53

Total consumption of edible oils

230.59

86.30 148.50

100.99 153.17

234.80

254.16

Source: DGCIS, Department of commerce

1.4 Import and export of oilseeds & vegetable oil

Import

India is heavily dependent on imports to meet its edible oil requirements and largest importer of vegetable oils in the world (15% share) followed by China & USA. Of imported edible oils , share of palm oil is about 60% followed by soybean oil with a share of 25% and sunflower (12%). Import growth in respect of edible oils during the last decades is about 174%.The import figure of edible oils during 2015-16 reveals that India imported a total of 15.88 million tonnes of oilseed and vegetable oil products worthing Rs. 69331.96 crore Table 3).

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Table 3: India's Imports of oilseed and vegetable oil Products

Commodity

Sesame seeds Niger seeds Groundnut Other oil seeds Vegetable oils Oil meals Castor oil

Total

Export

(Quantity: `000 tonnes), (Value Rs. Crore)

2015-16 (P)

Quantity

Value

23.60

179.66

5.78

44.14

0.11

0.31

62.51

218.62

15642.33

68676.62

148.30

210.38

0.14

2.23

15882.77

69331.96

Source: DES, DAC&FW

As per foreign trade policy export of edible oils was prohibited over the years. Currently the following exemptions are in place.

i) Edible oils permitted for export in bulk as well consumer packs of upto 5 kgs with MEP. a) Groundnut oil , sesame oil, soybean oil, rice bran oil, coconut oil b) Minor forest product oils

ii) Edible oils permitted for export in only consumer packs upto 5 kgs with MEP of UDS 900

per MT:

a) Olive oil, palm oil, sunflower oil, safflower oil, cotton seed oil. linseed oil, mustard oil.

India was never a big exporter of edible oils. India's export basket comprised of premium

oils with higher value realization (refined coconut, groundnut and sesame oils) and recently DOC

oil meals, castor oil , groundnut oil and sesame oil contributes largest share . The export figure

of edible oils during 2015-16 reveals that India exported a total of 8.20 million tonnes of oilseed

and vegetable oil products worthing Rs. 29527.97crore (Table 4).

Table 4: India's Exports of Oilseed and Vegetable oil Products

(Quantity: `000 tonnes), (Value Rs. Crore)

Commodity

2015-16 (P)

Quantity

Value

Sesame seeds

328.46

3012.31

Niger seeds

14.12

123.27

Groundnut

542.73

4075.63

Other oil seeds

204.62

964.47

Vegetable oils

30.60

522.94

Oil meals

6578.17

16519.53

Castor oil

565.99

4309.82

Total

8264.69

29527.97

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2.0 Vision

Considering the growing domestic demand for edible oils, the staggering deficiency and the cost to the exchequer on account of imports, the urgency of scaling up the oilseeds production does not need over-emphasis. It has now been planned to achieve a production of 45.64 million tonnes (mts) from nine (9) annual oilseed crops by 2022-23, expecting an additional production of about 15.58 mt over and above the 30.06 mt production (QE 2016-17) (Table 5). Thus, the availability of total vegetable oil from domestic production of nine annual oilseed crops would be about 13.69 mts by 2022 (at 30 per cent recovery) as against the current annual output of 7.0 mts.

Table 5: Status and anticipated area, production and yield of oilseed crops in India

Crop

Soybean Groundnut R & M Sunflower Safflower Sesame Niger Castor Linseed Total

Quinquennium ending 2016-17

Year 2022

Area

Production Yield

Area Production Yield

(m. ha) (m. tons) (tons/ha) (m.ha) (m. tons) (tons/ha)

11.38

11.94

1.05

12.50 18.75

1.50

4.99

7.39

1.47

5.72

9.72

1.70

6.19

7.39

1.19

7.47

11.95

1.60

0.59

0.44

0.75

0.97

0.87

0.90

0.16

0.08

0.53

0.27

0.22

0.80

1.75

0.77

0.41

1.97

1.18

0.60

0.26

0.08

0.32

0.32

0.16

0.50

1.06

1.80

1.70

1.40

2.45

1.75

0.28

0.14

0.49

0.57

0.34

0.60

26.67

30.06

1.13

31.20 45.64

1.46

Source: DFI Committee Estimates based on data compiled from DACNET

2.1 Anticipated area, production and yield

The total vegetable oil requirement in the country in 2022 has been estimated to be 33.20 million tonnes assuming per capita consumption of more than 22 kg per person per annum. The anticipated vegetable oil production from 45.64 million tonnes of oilseeds in the year 2022 is 13.69 million tones. The anticipated area, production and yield of oilseed crops by 2022 is given in Table 6.

The vegetable oil availability from secondary sources such as coconut, cotton seed, rice bran, solvent extracted oil (SEO) and tree & forest origin has been estimated at 5.22 million tonnes by 2022 (Table 7). As a sequel, the anticipated vegetable oil availability (primary + secondary + oil palm) would be around 17.03 million tonnes indicating the possible reduction in imports to the tune of about 15 per cent from the present 67 per cent by 2022. This would be an impressive achievement of reduction in import burden to an extent of about Rs. 15,000 crore vis?-vis present status of import.

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