Disagreement on soybean output affects edible oil prices

The Indian government and soybean industry are at odds over soybean production estimates for the 2024-25 season. The Union agriculture ministry claims a record production of 15.1 million tonnes, while the industry estimates it at only 12.6 million tonnes. This disagreement is affecting soybean oil prices, which are currently between 129 and 132 rupees per kilogram in wholesale markets. Industry experts believe the government’s production figures are inflated, noting that the area planted with soybeans has decreased significantly. B.V. Mehta from The Solvent Extractors' Association of India stated that the usual difference between government and industry estimates is around 5-10%. This year, however, the gap is considerably larger. He indicated that prices are unlikely to decrease soon due to the lower output. Madhya Pradesh is the largest producer of soybeans in India, followed by Maharashtra and Rajasthan. Sanjay Shrishrimal from The Soybean Processors Association of India also commented that prices are expected to stay high because of reduced crop yield and challenges in managing soybean meal, a by-product used in animal feed. Despite expectations of increased domestic production and higher soy oil imports, experts forecast that oil prices will remain elevated. This is partly due to recent changes in import duties on edible oils. Experts warn that for India to become self-sufficient in edible oil production, there is a need to enhance soybean production. To encourage farmers, the government has raised the minimum support price for soybeans for the upcoming marketing season from 4,600 to 4,892 rupees per quintal.