Financial Daily from THE HINDU group of publications
Wednesday, Oct 08, 2003
Oilseeds & Edible Oil
Agri-Biz & Commodities - Oilseeds & Edible Oil
Industry & Economy - Exports & Imports
After 20 years, India may export groundnut oil
Mumbai , Oct. 7
IT'S incredible but true. For the first time in 20 years, India is in a position to export groundnut oil this year.
This is possible thanks to a sharp rebound in output of oilseeds including groundnut and a significant increase in production of indigenous oil.
Forward quotes for raw groundnut oil are about Rs 42,000 a tonne. In the last four days, wholesale market rates rapidly dropped from Rs 51,500 a tonne to Rs 46,500 a tonne.
Several traders are examining the possibility of exporting groundnut oil, perhaps for the first time in two decades.
There was a brief chance in the early 1980s for export of the country's premium cooking oil, but since then domestic prices have always been way above international prices.
In the world market, groundnut oil of any origin is currently quoted at around $1,480 a tonne c.i.f. Rotterdam for September/October.
Prices have been steadily firming since July when the rate was $1,397 a tonne.
With high international prices and falling domestic market rates, chances of exporting groundnut oil raw /first press or solvent extracted are rated good.
A number of enquiries have already been received from international trading houses, said a prominent oil trader.
The Union Agriculture Ministry has estimated kharif 2003 oilseeds at 150.8 lakh tonnes, up from 92.2 lt of kharif 2002. Of this, groundnut in-shell this year is estimated at 59.3 lt versus last year's 35.6 lt.
Gujarat alone is expected to produce an all-time record crop representing close to 50 per cent of the country's groundnut output.
Harvest has already started on a modest scale and arrivals are expected to gather momentum in the coming days.
Gujarat's Agriculture Minister recently announced that the State would harvest about 37 lt of groundnut.
Traders, however, see the crop size at anything between 26 and 28 lt, which by itself is a new high.
With sufficient sub-soil moisture, the rabi (summer) crop prospects too are rated good.
Assuming output of about 18 lt of groundnut in the summer season, India's groundnut production in 2003-04 will reach 77 lt, which would potentially yield 22-23 lt of groundnut oil.
For 2003-04, world groundnut output is projected at 33.2 million tonnes, up from 30.6 mt the previous year.
World trade in groundnut oil is about 200,000 tonnes. How much of it India will be able to service remains to be seen.
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