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Rains lift hopes of soybean crop in central India

Rains in key soybean-growing areas in central India this week have given a new lease of life to the crop and improved production prospects, traders said on Friday.

India annually produces over five million tonnes each of groundnut and soybean in the winter season, sown mainly in Gujarat, Madhya Pradesh and Andhra Pradesh.

There were no rains in the last week of July in Madhya Pradesh, which accounts for about 70 per cent of the country's soybean output.

Traders feared the condition of the crop would deteriorate if there were no rains in the first few days of August.

Rains have also eluded Gujarat's Saurashtra region, which accounts for the main chunk of the state's winter groundnut output of around 2.2 million tonnes.

India's oilseeds season runs from November to October and soybean and groundnut are the major winter crops.

"It has rained well in the last two or three days in the soybean growing areas in Madhya Pradesh including Ujjain, Indore and Bhopal," said Harsh Maheshwari, a former chairman of the Soybean Processors Association of India.

"The crop situation is not as grim as it was last week."

The June-September southwest monsoon rains arrived over Kerala in early June and moved to western parts of the country, but its progress in northwestern India where oilseeds and rice are grown has been erratic.

The monsoon is vital to India's economic health as agriculture accounts for 25 per cent of the country's gross domestic product and employs some 70 per cent of its more than one billion population.

Agriculture Minister Ajit Singh has said the drought was the worst in more than a decade. But he said there would be no grain shortages because the country had sufficient stocks.

Traders said India's soybean crop area has fallen by nearly 11 per cent to 5.35 million hectares from the previous year.

Farm scientists said there could be yield losses if sufficient rains did not come during the flowering and pod-filling stages.

"The crop may be better now but we need rains periodically," said a dealer in Indore, the hub of the country's soybean trade.

He said the soybean crop needed intermittent rains and the number of showers were very important.

"The next rains should come within the next two weeks."

Traders said some farmers might take advantage of the rains and sowing could take place in areas left uncovered earlier.

"The crop has not been damaged but the moisture stress will affect productivity," said V K Jain, a leading soymeal exporter.

Prospects of a decline in groundnut and soybean output have boosted prices of premium oils in India, the world's largest edible oil importer.

It buys most of its palm oils from Malaysia and Indonesia and soft oils from Argentina and Brazil.

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