18/09/2007 (Bloomberg) - India's oilseed harvest may exceed government target this year, likely reducing imports of cooking oils that helped palm oil surge to a record.
Production of oilseeds, including peanut and soybeans, may exceed 18.5 million tons, as higher prices and above normal rain boosted planting, farm secretary P.K. Mishra said in New Delhi today. Output fell 15 percent to 23.88 million tons last year.
A bigger harvest in India may help cool palm oil prices in Malaysia and Indonesia, the world's biggest producers. Palm oil on the Malaysia Derivatives Exchange has advanced 72 percent in the past year, reaching a record in June, on rising demand in China and India, the world's biggest buyers of vegetable oils.
Palm oil futures for December delivery rose as much as 26 ringgit, or 1 percent, to 2,616 ringgit ($750) a metric ton in Malaysia, the eighth straight day of gain. The contract traded at 2,612 ringgit a ton at 1:20 p.m. India time. It reached a record 2,764 ringgit on June 6.
India's crude palm oil imports rose 24 percent to 276,151 tons in August from a year ago, while purchases of crude soybean oil climbed 39 percent to 159,324 tons in the month, after the government cut tariffs to encourage imports to meet demand.
Farmers sowed 17.3 million hectares (42.4 million acres) of monsoon oilseeds, including peanut and soybean, as of Sept. 13. That's 7 percent more than the 16.2 million hectares planted last year, the agriculture ministry said on Sept. 14.
Separately, harvests of India's summer-sown grain, such as rice and corn, may exceed the 114.2 million ton target set by the government, Mishra said.
Ample monsoon rainfall has improved ``prospects'' for the winter-sown wheat crop, he said.
India, which is importing wheat for a second year, said last week it aims to produce 75.5 million tons next year, the most in seven years.
Sowing of the monsoon crop, which makes up 60 percent of India's total oilseed production, begins in June. Harvesting ends in November.