Exports of 10 key agri products in negative zone in July

Low prices of agri-produce in the global market is one of the main reason for India's declining exports, said Exporters body

Exports of as many as 10 agriculture products including coffee, rice, spices and tobacco have recorded negative growth in July due to contraction in prices in the global commodity market.

Cereals, oil meals, oil seeds, fruits and vegetables, marine products, dairy and poultry products too recorded negative growth during the month, according to the Commerce Ministry.

In all, 10 out of 13 main agriculture products that are closely monitored by the Commerce Ministry, were in the negative zone in July.

Exporters body FIEO said that low prices of agri-produce in the global market is one of the main reason for India's declining exports.

"Prices in the domestic market are much above the global prices making domestic market a better option than exports," said Ajay Sahai, DG & CEO of Federation of Indian Export Organisations (FIEO).

During the month, exports of rice, spices and tobacco declined by 6.7%, 2.5% and 3.41%, respectively.

Other products which have reported negative growth include other cereals (71.56%), oil meals (43.81%), oil seeds (30.98%), fruits and vegetables (11.38%) and meat, dairy & poultry products (7.34%).

Decline in these exports is a key factor for overall contraction in India's merchandise exports.

Agri-products account for over 10% of the country's total exports.

As per estimates, outbound shipments of agri-produce in 2010-11 amounted $17.35 billion; $27.43 billion in 2011-12; $31.86 billion in 2012-13 and about $45 billion in 2013-14.

India's exports contracted for the eighth straight month by 10.3% in July to $23.13 billion, pushing the trade deficit to $12.81 billion.

In order to boost agri-exports, the Commerce Ministry is asking exporters to explore new markets and ship value-added products.

Prices of soyameal, a variety of oilmeal, has decreased to $392 per tonne from $509 per tonnne in August 2014.

"Our soyameal is costlier by about $100-125 per tonne in the last one year that is why we are outpriced in the global market," Solvent Extractors' Association Executive Directr B V Mehta said.