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Rapeseed & Mustard

Mustard and rapeseed (canola) is the third largest vegetable oil traded in the world, next to soyabean and palm oil. A genetically modified variety of rapeseed (Brassica sps.) that was developed by Canadian plant breeders specifically for its nutritional qualities and its low level of saturated fat is known as Canola, which is a short form of “Canadian oil”.
 
Nevertheless, Brassica species are cultivated since historic times, particularly in Asian countries. According to ancient Indian literature, cultivation of Brassica rapa was practiced since 1500 BC and seed of Brassica juncea was reported to have found in archaeological sites. On the other hand, the Chinese word for rapeseed was first recorded 2500 years ago, and the oldest archaeological discoveries reported to be dated back to 5000 BC.
 
Rapeseed oil reported to be used as a marine and industrial lubricant during World War II and consequently, the market for rapeseed oil plummeted in the post war period. Production of rapeseed has been rising rather steeply during the past two decades and has outpaced the production of other oilseeds including peanut, cottonseed and sunflower.
 
Economic Importance
 
Seed: Rapeseed and mustard is grown for its oil rich seeds. Apart from extracting oil, seeds are also used directly in the preparation of almost all Indian curries particularly in a process called “tadka”
 
Oil: Well-developed rapeseed seed contains 40 to 44% of edible oil.
Meal: Seed extract after recovering oil is used as a feed.
Recovery on average
Oil to Seeds– 33%
Cake to Seeds– 67%
 
 
Climate and Cultivation
 
Rapeseed and mustard can be cultivated in both tropical as well as temperate climates. Its growth is most vigorous in temperatures between 10°C and 30°C with an optimum temperature of around 20°C. Seed oil formation is optimum at a temperature of 10°C to 15°C. The crop is very sensitive to high temperatures as well as for frost at the time of flowering. Crop growth is healthy at a rainfall of 350-550 mm.
 
Rapeseed is normally cultivated as a rabi crop in India as it requires relatively cooler temperatures for seed setting and oil formation. Sowing normally starts in the month of November and the crop season spreads up to April.
 
Calendar of operations in India
 
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Rajasthan
 
 
 
 
 
 
 
 
 
 
 
 
 
Uttar Pradesh
 
 
 
 
 
 
 
 
 
 
 
 
 
Madhya Pradesh
 
 
 
 
 
 
 
 
 
 
 
 
 
Haryana
 
 
 
 
 
 
 
 
 
 
 
 
 
Gujarat
 
 
 
 
 
 
 
 
 
 
 
 
 
Punjab
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 Sowing
 
 Harvesting

 
 
World Scenario
 
World output of rapeseed and mustard has been increasing persistently and rather steeply during the past 15 years. The output has doubled from about 36 million tonnes in 2001-02 to 70 million tonnes in 2013-14. Production from European Union and Canada has risen steadily and reached to nearly 30% and 26% respectively of total world production. On the other hand, output from China has remained largely stable at around 12-13 million tonnes and consequently its share has declined to about 20% from about 31% a decade ago.
 
Table 1: Top five rapeseed producers, consumers and traders in the world
Producers
%
Consumers
%
Exporters
%
Consumers
%
EU
30
EU
36
Canada
57
China
27
Canada
22
China
27
Australia
30
EU
26
China
22
Canada
11
Ukraine
10
Japan
20
India
11
India
11
US
1
Mexico
11
Australia
6
Japan
4
EU
1
UAE
5
Source: USDA
 
 
The steep rise in production from Canada was primarily on account of significant expansion in area, which could have apparently been driven by a sharp rise in exports from Canada. While the production and consumption doubled during the past decade, trade has gone up by three times. During this period, exports from Canada rose by nearly four times.
 
 
Table 2: Trends in world production and consumption (million tonnes)
 
Production
Exports
Consumption
Stocks
2009-10
61.1
10.8
59.4
8.9
2010-11
60.6
10.9
61.5
7.2
2011-12
61.5
12.9
63.8
5.2
2012-13
63.0
12.5
65.3
3.2
2013-14
70.1
13.6
67.4
5.6
Source: USDA
 
Similar to production, world consumption pattern of rapeseed and mustard also doubled during the past 15 years primarily driven by the European Union, China and Canada. The European Union registered growth followed by Canada and China. Consequently, imports by China and the EU rose the steepest pushing them to top two positions replacing Japan and Mexico.
 
 
Domestic Scenario
 
 
 
 
 
India is the fourth largest producer of rapeseed & mustard. Production trends over the past two decades indicated that there was a significant shift in production levels from about 5-6 million tonnes until 2002-03 to around 7-8 million tonnes during the past one decade. The jump in production was primarily on account of sharp rise in yields. In addition, there was a significant expansion in area under rapeseed during the same period.
 
Table 3: Trends in domestic production and consumption (000’tons)
 
Production
Consumption
Stocks
2008-09
6700
6155
1007
2009-10
6400
6227
1180
2010-11
7100
7350
929
2011-12
6200
6825
304
2012-13
6800
6900
204
2013-14
7000
6975
229
Source: USDA
 
State-wise production
 
Rajasthan occupies the first place both in terms of cultivated area and production accounting for over 45% followed by Madhya Pradesh with 13%. Haryana and Uttar Pradesh occupy the third place contributing for 11% of total production each. Thus, the top four states produce about 80% of total rapeseed & mustard production in the country.  
 
 
 
Major Markets
 
Spot markets: Sriganganagar, Jaipur, Kota, Alwar, CharkhidadriandDelhi.
Futures markets: Mustard is traded in futures markets mostly in seed form. Major futures exchanges include Hapur, Hissar, Delhi, ACE, ICEX and NCDEX.
 
 
External Trade
 
India doesn’t export or import rapeseed and mustard seed.
 
Major export destinations: NA
 
Major import sources: NA
 
 
Factors Influencing Prices
 
  • Crop condition and output expectations: Extent of area sown under the crop, condition of the crop and output expectation.
  • Monitoring of rainfall and weather conditions that could affect the crop output.
  • Domestic demand expectation: Any changes in demand both domestic as well as international markets.
  • Stocks available in the market.
  • External demand and supply: Demand supply situation in major import sources.
  • Trade policies: Any change in government policy relating to change in tariffs etc.,
  
 
Rapeseed and Mustard Oil
 
 
 
 
Table 4: Trends in demand and supply of rapeseed oil in the world (‘000tons)
 
Production
Exports
Consumption
Closing Stocks
2009-10
22556
2728
22614
1288
2010-11
23516
3423
23501
1191
2011-12
24221
3970
23777
1674
2012-13
24874
3929
23653
2827
2013-14
25629
4182
24595
3448
Source: USDA
 
 
 
Table 5: Trends in demand and supply of rapeseed oil in India (‘000tons)
 
Production
Imports
Consumption
Closing stocks
2009-10
2080
18
2096
2
2010-11
2500
5
2318
185
2011-12
2310
98
2433
158
2012-13
2310
8
2425
49
2013-14
2330
50
2400
27
Source: USDA
 
 
 
 
Major Markets
 
Spot markets:
Sriganganagar, Jaipur, Kota, Alwar, AgraandKanpur.
 
Futures trading: NA
 
 
External Trade
 
Major export destinations: NA
 
Major import sources: Canada
 
 
Meal
 
 
Table 6: Trends in demand and supply of rapeseed meal in the world (‘000tons)
 
Production
Exports
Consumption
Closing Stocks
2009-10
33457
3607
33298
431
2010-11
34727
5151
34481
498
2011-12
35936
5370
35545
609
2012-13
36982
5412
37022
285
2013-14
38028
5582
37406
523
Source: USDA
 
 
Table 7: Trends in demand and supply of rapeseed meal in India (‘000tons)
 
Production
Exports
Consumption
Closing Stocks
2009-10
3287
786
2500
22
2010-11
3945
1311
2630
26
2011-12
3645
1000
2650
21
2012-13
3645
901
2735
30
2013-14
3670
875
2795
30
Source: USDA
 
 
 
Major Markets
 
Spot markets:
Sriganganagar, Jaipur, Kota, Alwar, AgraandKanpur.
 
Futures trading: NA
 
 
 
External Trade
 
Major export destinations:
Bangladesh, China, Italy, Japan, Malaysia and Thailand
 
Major import sources: NA

 

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