Higher soybean crop expected this Kharif

With the arrival of about 35,000 bags of soybean in the Malwa-Nimad regions during the last week, the new Kharif soybean crop season (2006-07) has begun in Madhya Pradesh (MP), the largest producer of the crop in the country.

The closure of soybean extraction plants (SEPs) for annual maintenance before starting soyoil extraction from Diwali and traders' hurry to clear their old stocks have resulted in a weak trading in prominent mandis of the state.

The traders are selling as many as 15,000-20,000 bags of old soybean a day at Rs 1,175-1,200 per quintal.

As per the latest survey report of the Soybean Processors' Association of India (SOPA), the new soybean crop position is very optimistic and between 65 lakh tonne and 70 lakh tonne is expected to be produced during 2006-07 in the country, compared with 58.51 lakh tonne last year.

Although, the crop in some areas of Nimad was reported to have been blighted by Girdle Beetle in August, farmers overcame the problem soon by spraying neem oil and exposing plants to neem smoke.

All the prominent mandis in MP officially closed for Dasara on October 2. But now, soybean arrival is expected to pick up steam. While SEPs are expected to purchase it from next week, soyoil extraction will begin only after Diwali.

Several SEPs are expected to come up on a lease basis for the next 2-3 months till the arrival pressure of new crop decreases.

There has been a demand from the traders in the state for removal of 4 per cent VAT on oilseeds as the neighbouring states of Maharashtra and Gujarat do not impose any such tax. The traders are apprehensive that soybean trading will be affected in the state if VAT is continued to be levied.

Apart from the 4 per cent VAT, two percent central tax is also levied on soyoil in the state. Consequently, people in the state end up buying soyoil at much higher price than their counterparts in the neighbouring states.