India Agribusiness Report Q2 2012 - new market research report

London 5/17/2012 10:01 AM GMT (TransWorldNews)

The price of this market report covers 4 quarterly reports on this sector. This quarterly report will be downloadable instantly as a PDF document, with the 3 remaining reports delivered at regular intervals throughout the year.

2011/12 is expected to be a good year for the Indian agriculture sector on the whole, thanks to decent monsoon rains in Q411. With better supplies, the country is well poised to export key grains such as rice, wheat and sugar once more. However, we highlight that the enacting of the Food Security Bill in 2012 could keep domestic procurement of foodgrains high and might prevent export momentum continuing into 2013.

Key Trends

- Rice production growth to 2015/16: 10.8% to 110.6mn tonnes. This increase will come from increased domestic demand as Indias population continues to swell, as well as better access to pesticides and fertilisers, which will improve crop yields.

- Milk production growth to 2015/16: 22.7% to 143.6mn tonnes. This will largely come from increasing domestic consumption of milk, as well as value-added goods like cheese and butter. - Coffee production to 2015/16: 21.0% to 6.5mn bags. This will come from the further cultivation of land in non-traditional coffee states such as Andhra Pradesh and Orissa.

- 2012f real GDP growth: 7.3% (down from 6.8% in 2011; predicted to average 7.6% from 2012 until 2016).

- 2012f Consumer price inflation: 8.5% average (down from 9.2% y-o-y average in 2011; predicted to average 5.9% from 2012 until 2016).

Industry Developments

We highlight that inroads into new sugar export markets such as to countries in the Persian Gulf, could be made as the country increases exports in 2012. According to reports, Middle Eastern buyers could be inclined towards importing India-sourced raw sugar to be refined domestically instead of buying from Brazil, as is usually the case. The main attraction would be in the significantly cheaper shipping rates when importing sugar from the South Asian country. It has been estimated that Indian sugar shipments cost less than Brazilian shipments by more-than US$45/tonne.

We still believe that we will start to observe a change in Indian palm oil import dynamics in 2012, from crude palm oil imports to refined products. This will be on the back of the new palm oil export tax regime in Indonesia. Due to refined imports from Indonesia being relatively cheaper than it was before the tax change in October 2011, we expect to see gradual changes in Indian demand, shifting from raw imports (currently about 80% of total palm oil imports) to refined products (less than 15% of total palm oil imports).

Nestlé India, the Indian subsidiary of Swiss food and nutrition company Nestlé has launched Nescafé Plan, a global programme to help coffee farmers and optimise its coffee supply chain. The company has opened its first coffee demo farm and training centre in Karnataka as part of an optimisation plan, which will help farmers improve quality, productivity and sustainability. The programme has been designed to provide farmers high-yielding, disease resistant plantlets suitable for Indian conditions, according to a statement released by the company.

Click for Report details:India Agribusiness Report Q2 2012

 

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