Commodity Analysis

News Wrap: Kharif sowing gathers pace

| Updated on June 17, 2018 Published on June 17, 2018

Planting of key kharif crops such as paddy and maize has picked up as the South-West monsoon has advanced further into parts of Maharashtra and Odisha.

The latest figures released by the Agriculture Ministry last week show that kharif acreage, as on June 14, stood at 93.01 lakh hectares (lh), marginally lower than the corresponding figure last year (94.21 lh), but 1.7 per cent higher than the normal for the corresponding week.

This season’s acreage under paddy has surpassed the previous year’s sowing level, and now stands at 6.93 lh against 6.87 lh last year. Improvement has mainly been seen in States such as Uttarakhand, Meghalaya, Nagaland, Tamil Nadu and Arunachal Pradesh.

The area sown under pulses, on the other hand, is lower than that in the corresponding period last year. Though area under tur has increased 13 per cent to 0.52 lh compared with 0.46 lh last year, other pulse crops have seen a decline. Overall, coarse cereals, too, have reported declines in the area sown so far. From 9.69 lh last year, it has dropped nearly 17 per cent to 8.07 lh. But among coarse cereals, jowar has reported 7 per cent increase in area sown, to 8.07 this year, mainly in Karnataka, Uttarakhand, Jammu and Kashmi, and Haryana.

Oilseeds area is also trailing last year’s levels, mainly on account of lower coverage in Gujarat, where the monsoon is yet to make its presence felt.

Cash crops cotton and sugarcane have reported increases in acreages. It has crossed 50 lh this week with Uttar Pradesh, Maharashtra, Karnataka, Andhra Pradesh and Punjab registering an increase in planted area.

Cotton acreage increased by 0.24 lh this year compared with the previous year, mainly on account of increases in Karnataka, Telangana and Madhya Pradesh.

Centre hikes import duty on edible oils

The Centre on Thursday increased the import duty on crude and refined soft edible oils such as soy oil, sunflower oil and rapeseed oil. Duty on crude, soft edible oils has been hiked to 35 per cent and on soft oils to 45 per cent.

Earlier, crude soy oil attracted an import duty of 30 per cent, and sunflower and rapeseed 25 per cent. The refined variants of all these three edible oils attracted 35 per cent.

The Solvent Extractors Association’s (SEA) efforts have yielded results, said BV Mehta, Executive Director of the apex trade body of the edible oil industry.

The government has, however, kept the import duty on crude and refined palm oils unchanged.

Data compiled by SEA revealed that palm oil imports (including RBD Palmolein, CPO and CPKO) during May 2018 stood at 4.96 lakh tonnes (lt), as against 7.78 lt in April 2018, a decline of 36 per cent.

“For the first time, the share of palm oils in the overall vegetable oil imports has dropped to 40 per cent, against the earlier norm of 58-70 per cent. The share of soft oils has increased to 60 per cent. This is mainly because of the high import duty on palm oils and low duty on soft oils,” Mehta, said.

Apart from the duty structure, rupee depreciation and credit crunch in the market have also contributed to the slowdown in imports, he said.

Fuel spike pushes WPI to 14-month high

Inflation in the Wholesale Price Index (WPI) jumped to 4.43 per cent in May, hitting a 14-month high, largely on account of the spike in fuel prices. WPI was 3.6 per cent in April this year and 2.26 per cent in May 2017. Government data released on Thursday revealed that inflation in the ‘fuel and power’ basket rose sharply to 11.22 per cent in May from 7.85 per cent in April, as prices of domestic fuel increased in line with rising global crude-oil rates.

Inflation in vegetables climbed to 2.51 per cent, with potato inflation at a peak of 81.93 per cent. The price rise in fruits was in double digits, at 15.40 per cent, while pulses saw a deflation of 21.13 per cent.

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