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The disagreement between the industry and the government regarding soybean output centers on differing estimates for the 2024-25 kharif marketing season in India. The Union Agriculture Ministry’s second advance estimates project a record soybean production of 15.1 million tonnes. In contrast, industry experts, including The Solvent Extractors' Association of India (SEA), estimate a lower figure of 12.6 million tonnes. This gap—nearly 2.5 million tonnes—stems from concerns over reduced sowing area and discrepancies in yield assumptions. The industry notes that soybean was sown over 11.83 million hectares in 2024-25, down from 12.54 million hectares the previous year, a reduction of about seven lakh hectares. While the industry acknowledges a higher yield contributing to an output of 12.58 million tonnes, it argues the government’s figure is overstated, with typical differences between official and industry estimates usually ranging from 5-10%, not the current magnitude.
This disagreement has significant implications for edible oil prices, particularly soybean oil, a key affordable cooking oil in India. Industry leaders, like B.V. Mehta from SEA, argue that with production closer to 12.6 million tonnes, supply will remain tight, preventing any softening of soybean oil prices in the near future. Current wholesale prices for soybean oil stand between ₹129-132 per kg, reflecting sustained high costs. Additionally, India’s reliance on edible oil imports—about 60% of its 26 million-tonne annual requirement—combined with recent duty hikes (crude soybean oil from 0% to 20% and refined from 12.5% to 32.5%), further pressures prices. Experts suggest that boosting domestic oilseed production, alongside the increased minimum support price for soybean (now ₹4,892 per quintal from ₹4,600), is critical for self-sufficiency, but current output levels may not suffice to ease market strain soon. Thus, the industry predicts elevated edible oil prices will persist into 2025.
Source: Online/GFMM
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