The total production of rice is estimated at record 108.86 MT which is also a new record in year
2016-17. This year’s rice production is higher by 2.21 million tonnes than previous record
production of 106.65 MT achieved during 2013-14. It is also higher by 3.44 MT than the five
years’ average rice production of 105.42 MT. Production of rice has increased significantly by
4.45 MT than the production of 104.41 MT during 2015-16.
With the good demand in the markets, paddy prices hovering in the Rs. 1,600 – 2,900 per quintal in the market. Prices of basmati rice are high and in the range of Rs. 7,300-7,600 per quintal while prices of common rice are in the range of Rs. 1,600-2,900 per quintal. Last year, paddy rates were in the range of Rs 1,700-1,900 per quintal. The Union government had announced the minimum support price (MSP) for the common paddy at Rs. 1470 and grade A paddy at Rs. 1510 per quintal.
International prices are also higher at USD 395 per tonne while the domestic rates are around USD 337 per tonne. There is good demand for non-basmati rice from Senegal, Benin, Nepal, Cote D Ivoire and Guinea and basmati rice from Saudi Arabia, Iran, United Arab Emirates, Iraq and Kuwait.
All-India progressive procurement of Rice as on 27.01.2017 for the Kharif marketing season 2016-17 was 265.74 lakh tonnes against the procurement of 235.21 lakh tonnes in the corresponding period of last year. Indian Basmati Rice FOB firm in January by 4%. The 2016-17 global supply was 480 million tonnes, up almost 2% from a year earlier and the highest on record.
Global rice supplies for 2016/17 are raised fractionally this month. World exports are raised 0.5 million tons led by increases for Thailand and India. Global use is raised 0.8 million tons resulting in a 0.8 million ton reduction in the world ending stocks forecast.
The current global agricultural outlook scenario presents mixed blessings for India. Overall, even though overall production for the crop year 2016-17 is higher than last year, but rabi production may be less than the target. Resulting slight increase in the prices during rabi harvest period.
The production of wheat, estimated at 96.64 million tonnes for the year 2016-17 is also an all-time
record. Wheat produced in 2016-17 (July to June) will be marketed in 2017-18 (April to March).
This year’s wheat production is higher than the previous record production of 95.85 MT achieved
during 2013-14. Wheat production during 2016-17 is also higher by 4.03 MT than the average
wheat production. The current year’s production is higher by 4.36 MT as compared to wheat
production of 92.29 MT achieved during 2015-16.
Domestic prices of medium fine wheat are high and in the range of Rs. 2,000 – 2,400 per quintal while prices of medium wheat are in the range of Rs. 1,600-1,800 per quintal. While the minimum support price for the common wheat at Rs. 1470 and grade-A wheat at Rs. 1510 per quintal. Last year, wheat rates were in the range of Rs 1,700-1,900 per quintal.
The various estimates project that wheat production will grow between 1.3 and 2 percent annually, that the per capita consumption of wheat will increase by around 1.1 percent annually and that the price of wheat will increase by 4.2 percent annually over the next ten years.
International prices are also higher at USD 201 per tonne. There is good demand for wheat from Bangladesh, Nepal, United Arab Emirates, Taiwan and Philippines. To check imports, the government imposed 10 per cent import duty on wheat, which was later enhanced to 25 per cent.
The International Grains Council (IGC) forecast for world wheat production in 2016-17 to 752 million tonnes, compared with the record outturn of 736 million tonnes in 2015-16. The IGC forecast 2016-17 world wheat ending stocks at a record 235 million tonnes, up 14 million tonnes from 221 million tonnes in 2015-16. For the first time since 2012-13, IGC expects total consumption to be greater than total production.
Given the record production of wheat in Indi and higher global stock, it is likely that the prices will be moderate during the wheat harvesting period (April to March).
The agriculture ministry in its second advance estimates projected India’s cotton output at 32.51
million bales (170 kg each) in 2016-17, up from 30.01 million bales in 2015-16.
With cotton (raw) prices hovering in the range of Rs. 5,700 to 5,800 per quintal due to good demand in the market. Cotton milling industry experts do not rule out prices touching the Rs. 6,000 per quintal mark soon. Whereas the minimum support price (MSP) for the medium staple (27.5mm) cotton was only Rs 4,060 per quintal. Last year, cotton rates were in the range of Rs 4,200-4,300 per quintal.
International prices are also higher at Rs. 44,956 per candy (356 kg) while the domestic rates are in the range of Rs. 41,700-42,300 per candy. Cotton seed prices are high and in the range of Rs. 2,500-2,850 per quintal while cottonseed oil cakes are in the range of Rs. 2,200-2,450 per quintal. There is good demand for Indian cotton from Pakistan, Bangladesh, Vietnam, Indonesia and China. As per unconfirmed reports, Pakistan has purchased some 20 lakh bales, Bangladesh has purchased around 10-12 lakh bales, China some 15-20 lakh bales and 5-6 lakh bales have reached other markets.
The Cotton Advisory Board has pegged the output at 351 lakh bales for the 2016-17 season starting October. Similarly, the International Cotton Advisory Committee expects the cotton output in India this year to remain unchanged at 58 lakh tonnes from 2015-16. The production and consumption of cotton as predicted by the Cotton Advisory Board for this season (October 1, 2016 to September 30, 2017) are 351 lakh bales and 313 lakh bales (of 170 kg each) respectively.
Apart from the price, the cotton yield too has gone up to 20-22.5 quintals per hectare in the current season from the nearly 12.5 quintals per hectare in the 2015-16 season marred by the pest attack.
Higher rates and more yield could encourage more farmers to sow cotton in the coming kharif season. Many farmers had gone shifted to other crops after suffering huge losses in the 2015-16 season due to the pest attack. After losing out about 20 per cent area to pulses, cotton is set to regain the lost ground in the upcoming kharif season due to higher global demand and higher expected prices.