Exports of 8 out of 10 key agricultural products slide in September

Deepak Kumar | The Dollar Business

Weak global demand and shortfall in domestic production have led to a steep fall in India’s export of agricultural products in the past few months, say experts. In September this year, the export of 8 out of 10 key agricultural products witnessed a negative growth with cereals registering the steepest decline of almost 64%, the latest government data showed. Industry experts have attributed the downward trend to the weak demand in the European market, devaluation of Chinese yuan and lesser domestic production. “Several factors including devaluation of yuan and market crisis in the European Union have led to a considerable fall in exports. Domestic production has also been hit. Overall we are seeing a decline; both in terms of quantity and value,” an industry expert told the Dollar Business. Last month, cereals exports fell by 63.95% to reach $16.16 million from $44.83 million in September 2014. During the period, shipments of other agricultural products, including oil seeds, cashew, rice and tea, also contracted by a significant margin. “The government has been working on a 10-year plan to revive India’s vegetable oil and oil seeds industry. Some Indian companies, including Aditya Birla, have its trading facilities in Myanmar and Indonesia, where it trades in major agro products including oil seeds, rice and beans. The emphasis is to bring back their operations to India. The plan also envisages encouraging oil production in India’s southern states as they hold immense potential. The benefit of this plan will be visible over a period of time,” Atul Kumar Saxena, President of the Indian Importers Association (IIA), told The Dollar Business. In September this year, oil seeds exports fell by 37.18% to $60.95 million from $97.03 million, while rice exports declined by 13.39% to $553 million from $639 million in 2014. Tobacco and oil meals remained the only product categories that recorded positive export figures over the corresponding month of 2014. Tobacco exports in September grew by 23.89% to over $104 million from $84 million, while oil meals exports recorded a meager growth of 1.47% over September 2014. “If we look at India’s overall rice exports in terms of quantity, there isn’t much difference. But in terms of value, the figure has indeed gone down. This seems temporary. As the global market picks up, realisation will automatically go up,” R Sundaresan, Executive Director of All India Rice Exporters Association (AIREA), told The Dollar Business.  

October26, 2015 | 2:49pm IST.