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Kharif pre-harvest price forecasts for 2017-18

Price forecasts for farm level for next three months

Good quality groundnut pods to touch Rs.5000/qtl

Sunflower seeds to get Rs.3000-3400/qtl

 

            Given the population of 1.3 billion people, the consumption of edible oil in India, is around 21-22 million tones. The domestic supply of edible oil is estimated at 10.97 million tonnes and the import is 13.23 million tonnes  up to September, 2017 as per the estimates of Directorate of Vanaspati, Vegetable oil and Fats (DVVOF), Government of India.  In 2017-18 oil year, India’s  imports of edible oil is likely to increase further as per Solvent Extractors Association of India inspite of duty levied on edible oil imports.

Globally, India is the largest importer of edible oils. Around 60 per cent of edible requirements of the notion is being imported. In this falm oil constitutes around 60 per cent. The domestic prices of all edible oils seeds in India is very much influenced by international prices palm oil in Indonesia and Malaysia.  Taking into account the above situation and anticipated production at national level, the price forecasts of groundnut pods and sunflower seeds are estimated by AMIC operating of IABM. ANGRAU, Tiruapti.

 The area sown under  groundnut in India in kharif 2017-18 stood at  41.58  lakh hectares as against 46.98 lakh hectare  in corresponding  season   of 2016-17. In Andhra Pradesh the area in Kharif 2017-18 was at 6.66 lakh hectares compared to 9.31 lakh hectares in 2016-17.

The analysis of modal prices of groundnut from Kurnool market for 12 years with the help of time series model, given the present market sentiments, the groundnut prices of good quality pods would revolve around Rs.5000 per quintal. In the coming four months.

Sunflower

Sunflower oil is imported from Ukrain, Russia, Turkey and Argentina with Ukraine having a share of 95 per cent. The health consciousness of Indian consumers helped the consumption of sunflower oil to increase by 5 times in the past one and half-a-decades. In 2015-16, the imports of sunflower oil from Russia and Ukraine touched 15.16 lakh tones compared to 9.73 lakh tonnes in 2012-13. The obvious reason for this trend is that sunflower seeds production in the country has declined from 2010, while its production has increased internationally. There is no surprise if imports of sunflower touch 20 lakh tonnes in oil year 2016-17.  

The price forecast groundnut pods and sunflower seeds estimated by Agricultural Market Intelligence Centre (AMIC), operating at Institute of Agribusiness Management (IABM), N.G Ranga Agricultural University, S.V. Agricultrual College, Tirupati taking the modal revolved that, prices of sunflower from Kurnool market for 12 years with the help of time series model. Given the present market sentiments, the sunflower prices would be close to Rs.3200 to 3400/- in the coming 4 months.

In December, 2017 the edible oil seed prices are likely to increase very slightly. This increase is not sufficient to cover the storage cost, the storage loss and the interest accrual. Hence, farmers are recommended to sell groundnut and sunflower seed on harvest without going for storage.

 

  Maize prices would be around MSP in the Coming Months

Maize is one of the successful stories of Indian agriculture in recent years as the production increased from 15.1 million tonnes in 2006-07 to 26.26 million tonnes in 2016-17. Trade is dominated by the US as the world’s largest producer and  exporter. US maize exports account for 35-40 per cent of world trade.

            The acreage of all major crops, barring  cotton and sugarcane in 2017-18, is less than the previous year's. According to the sowing data of the Central Agricultural Ministry, area under Kharif maize stood at 78.66 lakh ha. as against 82.87 lakh hectares sown in 2016-17 kharif. The area under the crop in Madhya Pradesh was 13.17 lakh hectares followed by Karnataka with 11.11 lakh hectares. The other important states are Maharashtra, Rajasthan and Uttar Pradesh with 9.12, 9.02 and 7.26 lakh hectares respectively. Global production during 2016-17 was 1067.21 million tones and the in the current year the estimates indicate as input of 1031.86 million tones a decline of 3.31 per cent. Indian output is likely to be 25 million metric tonnes  against 26.26 million tonnes in 2016-17. The area under maize in Andhra Pradesh was little more than normal area in 2017-18. Under the circumstances the Agricultural    Market Intelligence Centre operating  in the Institute of Agribusiness Management, S.V. Agricultural  College, campus,Tirupati analysed the modal prices of maize for 16 years in Nizamabad market using econometric tools and came out with the result that in the coming three months maize prices would be around MSP.  Farmers can take selling decision accordingly.

 

  Greengram prices likely to be less than MSP in the Coming three months

                      According to the Ministry of Agriculture the total area under pulses was 13 million hectares in 2017-18, which is 3.5 per cent less than the 13.5 million hectares cultivated in the same period last year. The notification used by the Director General of foreign trade restrict the import of blackgram  and greengram to 3 lakh tones per annum is expected to help farmers get better prices for their produce. Pulses production in 2016-17 was around 22.13 million tonnes compared to 16.35 million tonnes in 2015-16. As per the estimates of NITI Aayog the projected demand for pulses in 2016-17 was around 24.61 million tonnes which implies that the demand is higher than the domestic production. Despite record harvest of pulses, the year 2016-17 has been a challenging year for the growers. The prices have fallen below the minimum support prices and one expected a fall in Kharif area of 2017-18 but contrary to the expectations the area has increased. The erratic rainfall prompted farmers in Rajasthan and Madhya Pradesh to opt for pulses in place of soyabean and similarly maize gave way was to pulses.  Area under greengram in the country was 31.03 lakh hectares in 2017-18 and in Andhra Pradesh the area under the crop was less than normal. To help farmers to take selling decision the Agricultural Market intelligence Centre operating in Institute of Agribusiness Management, S.V. Agricultural  Campus analysed the modal prices of greengram of Tandur market from 2000-2017 using econometric models. The results of the analysis coupled with market surveys indicate that the present price line of Rs.4300-4500 is going to prevail in the coming three months and the farmers are advised to take decision accordingly.

 

 

Cotton prices would be under pressure in the coming 3 months

The Cotton Association of India (CAI) in its first estimate for the crop year 2017-18 revealed that cotton output would be around 375 lakh bales, which is higher by 37.75 lakh bales compared to the previous year’s crop. The higher expected output this year is on account of higher acreage compared to previous year. About 19 per cent increase in area was found in 2017-18 over 2016-17. With the opening stock of 30 lakh bales at the beginning of the year with likely imports of 17 lakh bales, the total supply of cotton for 2017-18 would be 422 lakh bales. According to the latest estimate of U.S Department of Agriculture for 2017-18, global cotton production at about 120.8 million bales is expected to be 13 per cent more than in the previous season. India, China, and U.S’s share of world cotton output in 2017-18 is 63 per cent. India normal annual consumption is around 280 to 300 lakh bales and exports could be around 70 lakh bales. With import standing at 17 lakh bales this scenario is going to put pressure on cotton prices in the coming months.

            Under the circumstance the Agricultural Market Intelligence Center of Institute of Agribusiness Management has forecasted the prices of cotton in the coming months using modal prices of cotton in Warangal Market with the help of time serious models. The results of the model along with market survey and given present market sentiments indicate that cotton prices would be around MSP in the coming 3 months i.e Rs.4300/Quintal till January, 2018. The price can be watched after February, 2018 for a positive change. 

 

 

 

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Please note that this is the opinion of the author and is Not Certified by ICAR or any of its authorised agents.