India to Witness Reduced Wheat Production in 2024, but Record Rapeseed Crop Expected

India to Witness Reduced Wheat Production in 2024, but Record Rapeseed Crop Expected

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Mintec Global
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India is poised to experience a significant shift in its agricultural landscape in 2024, with projections indicating a decrease in wheat production accompanied by a record-breaking rapeseed harvest. According to reports from Reuters, favorable weather conditions coupled with an expansion in the cultivated area are expected to bolster rapeseed output, potentially alleviating the need for costly imports of soybean, sunflower, and palm oil.

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The area dedicated to rapeseed cultivation has witnessed a notable uptick, expanding by 5% to cover 10 million hectares. This expansion sets the stage for a potential harvest increase from 11.5 to an estimated 11.8-12 million tons, with current crop conditions reported as favorable across the majority of states.

Contrastingly, wheat production estimates for the 2023/24 marketing year suggest a decline, with projections ranging between 107-108 million tons. This figure falls short of both the previous year’s output and the official forecast by MSG India, which anticipated a harvest of 114 million tons. Despite maintaining sowing levels from the previous year, diminished yields attributed to a deficit in precipitation are anticipated.

Traders are bracing for a potential shortfall in wheat supply within the domestic market, exacerbated by the depletion of government reserve stocks. As of December 31, wheat reserves in India plummeted to a seven-year low of 16.35 million tonnes, marking a decline from the previous year’s 17.17 million tonnes.

Reflecting these dynamics, spot market prices for wheat in India have experienced a decline, currently standing at 26 thousand rupees or $313.21 per ton or € 290,83 per ton as of February 16. This marks a 16% decrease from the previous year’s levels.

The evolving agricultural landscape in India underscores the importance of weather patterns, cultivation strategies, and market dynamics in shaping the nation’s food security and economic landscape.

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