COMMODITIES-GRAINS: Shortage Could Send Oilseed Prices Spiralling

LONDON, Dic 17 (IPS) - A developing shortage of oilseeds and oilseed animal feed ingredients could lead to sharply higher prices, warned officials.

According to official statements the country's oilseed production will drop by 300,000 tonnes this season, while consumption will soar by 900,000 tonnes, leading to a huge 1.2 million tonne shortfall.

The 'Economic Times' of India recently wrote that nine major oilseed crops of the 1994-95 summer (Kharif) season are expected to show a decline.

Soyabean is the most important Kharif crop and its production is projected to be hit badly in Madhya Pradesh, a major growing area. Last year the area produced 2.86-million tonnes of soyabeans, but this season output will drop by an estimated 600,000 tonnes.

Groundnut production in Andhra Pradesh is estimated to be 600,000 tonnes down. In sunflower production, a deficit of 100,000 tonnes is expected, said the newspaper.

It added that the marketable surplus for crushing is pegged at 8.15 million tonnes, compared to 8.7 million tonnes for the 1993- 94 Kharif season, leaving a large deficit.

On feed meals, the oilseed situation is more surprising. Indian producers are asking for imports to offset the looming supply shortage, said the Solvent Extractors' Association of India (SEA) in statements last week.

Predictions of 10.92-million tonnes for the 1994-95 (November- October) Kharif crop have been mooted. Last season's crop was 11.21 million tonnes.

India is a major exporter of meal and oil to the region and some sources said that any shortage is more technical and than actual, more related to speculative action on palm oil markets.

Palm oil is the most important of the vegetable and oilseeds products, used in cooking oil, food processing and industrial uses. Recently prices have skyrocketed because of a complex web of factors.

The first is that the rapid output expansion of recent years has started to fall back.

There has also been a boost in Asian import demand, and a dearth of cheap alternative oils. Floods in the United States last year meant that soyabean oil was then scarce and expensive, pulling up the price of all other food oils.

© Inter Press Service (2014) — All Rights Reserved. Original source: Inter Press Service