Top 10 Farm Exports: Cotton No Longer Key In Farm Story

For the first time since 2005-06 when India became a major exporter of cotton following a large-scale adoption of Bt-seeds, the fibre has failed to be on the list of the country’s top ten farm export items.

According to the latest official data, exports of raw cotton — including waste —stood at just $308 million in the first half of this fiscal, less than a half of the level seen a year before. Cotton — which was the top farm export item in FY11 and FY12—has steadily lost ground and is now languishing at number 12 in the list of major commodities covering the farm and allied sector.

With domestic cotton prices mostly remaining above the global levels (by 5-10%) in recent months —thanks to an annual 11% drop in output in the last marketing year through September 2016 and a steady offtake by the domestic textile industry — cotton exports are unlikely to cross $700-800 million in the current fiscal, senior trade and industry executives told FE.

Cotton — which was the top farm export item in FY11 and FY12—has steadily lost ground and is now languishing at number 12 in the list of major commodities covering the farm and allied sector.
With domestic cotton prices mostly remaining above the global levels (by 5-10%) in recent months —thanks to an annual 11% drop in output in the last marketing year through September 2016 and a steady offtake by the domestic textile industry — cotton exports are unlikely to cross $700-800 million in the current fiscal, senior trade and industry executives told FE.

Exports are taking a hit due to demonetisation too, with adverse impact of the cash crunch on transportation and other activities.

With demand from top buyer China still subdued and Pakistan turning more protectionist against Indian cotton supplies, exports are unlikely to stage a sharp rebound this year, the sources said. This is despite the fact that India’s cotton output is expected to rise to 35.1 million bales in 2016-17 marketing year, compared with 33.8 million bales in the previous year. One bale equals 170 kg.

Pakistan had put cotton supplies from India through the Wagah and Karachi port on hold from November 23 on grounds of non-compliance of phyto-sanitary conditions before lifting the curbs last week.

In a recent interview to FE, textiles secretary Rashmi Verma had said the government was stepping up focus on domestic value-addition in cotton, which would help create more jobs locally. So, instead of promoting exports of the raw material, the textile ministry’s endeavour would rather be to facilitate greater outbound shipments of cotton-based finished products, Verma had said.

Until recently, China had been the biggest buyer of the Indian cotton, accounting for as high as 70% of the county’s total outbound shipments of cotton. With China gradually shifting from labour-intensive industries like garments and textiles and also trimming its massive inventory, its need for Indian cotton is unlikely to recover anytime soon. This means Indian cotton exporters will now rely more on Bangladesh, which has been ramping up purchases in recent years to meet growing requirement of its garments industry.

According to a November report of the US-based International Cotton Advisory Committee (ICAC), year-ending stocks in China, where much of the excess supplies are held, decreased by 13% to 11.3 million tonnes in 2015-16, as the government there sold over two million tonnes from its official reserves from May through September 2016. China restricted import quota to the volume required by its commitments to the World Trade Organization in 2015 and 2016, and announced that it will continue to do so in 2017. “In addition, the government is planning to begin sales from its reserves in March 2017 when the majority of the new crop will have been sold,” the ICAC said.

By contrast, Bangladesh is among the only three of the top 10 consuming countries where cotton requirement is going to rise, according to the ICAC. The consumption by the textile mills in Bangladesh is forecast to increase 12% to 1.2 million tonnes in 2016-17.

India’s farm exports, covering 43 major segments, stood almost flat at $15,192 million during the April-September period from a year earlier.

 

Sources :financialexpress.com

Imported Gold Worth $2 Billion Used For Conversion From November 11-20

MUMBAI: The latest estimates of gold imports by a leading industry source in the days following demonetisation shows that certain entities in the gold trade, in possible collusion with some bankers, helped people convert their black money to gold bars and jewellery.

While official import figures of November have not been released, the industry source said 72 tonnes were imported during that month. Of this, he claimed 52 tonnes worth Rs 15,000 crore were over $2 billion or brought in during November 11-20, days after demonetisation on Nov 8. Nine tonnes were imported in the first 10 days and 11 tonnes in the last 10 days of the month.

"That 52 tonnes were imported just after demonetisation from November 10 shows the hand of certain unscrupulous entities in the trade in facilitating conversion," the source said. "The government has its task cut out as it could ascertain which bank imported how much in the 10 relevant days and to whom were these sales made."

However, while admitting that "shady elements" had tarnished the entire jewellery trade's "image" Surendra Mehta, secretary of India Bullion & Jewellers Association (IBJA), claimed of the estimated 95 tonnes import, in Nov, 30% would have been for conversion of black money, unlike the trade source's figure of 70%.


IBJA has include dore or raw gold imports in its estimate unlike the trade source's one. Of his estimated figure 75 tonnes were imported in the first fortnight of the month."The price of gold came down and tariff value was revised downwards after Nov 16, when the remaining 25 tonnes were imported, we estimate.

 

 

Sources :economictimes.indiatimes.com

Car Exports Gain Speed, On Track In Fy17

 Prospects of a double-digit growth in the domestic passenger vehicles market in the current financial year look uncertain after demonetisation but a stronger growth story in the export market seems intact. Passenger vehicles (cars, vans and utility vehicles) exports are on track to hit a new record in FY17, as shipments continue to post strong double-digit growth.
 
In the first eight months of FY17, exports have grown about 16 per cent to 499,037 vehicles, against a growth of 9.84 per cent in domestic sales volume (to two million units) of companies. In the corresponding period of FY16, exports had grown by only 4.3 per cent. Export volumes could cross 700,000 units for the first time in a year on the back of a sharp surge in numbers from companies such as Ford, Volkswagen and General Motors. India exported a record 653,889 vehicles in FY16, growing only about five per cent over the previous year. Latin America, Africa and Europe are top export destinations for India-made cars.
 
A double-digit growth in exports is seen after three years. Hyundai, the largest exporter, also posted a four per cent growth and shipped almost 119,000 vehicles in the first eight months of the financial year. “With India becoming a stage for the launch of more and more global models by automobile multinationals, these models are presenting an opportunity for export to non-manufacturing markets,” said Rakesh Srivastava, senior vice-president (sales and marketing) at Hyundai.

 
Like the domestic market, growth in export volume is being driven by the utility vehicles (UVs). UVs exports have surged 48 per cent to 107,916 units in April-November period. Hyundai exported 33,308 units of its popular sports utility vehicle Creta in April-November period this year against 3,866 units in the corresponding period last year (the vehicle was launched in July 2015).
 
Ford, the second-biggest passenger vehicle exporter after Hyundai, maintained the export volumes of EcoSport at about 57,000 units in first eight months. M&M also reported an increase in exports of Scorpio and XUV500. Against the 48 per cent growth in UVs export, export of cars has grown 9.5 per cent. India exported 389,189 cars in the April-November period. New models like Creta and Baleno helped growth in shipments of UVs and cars, respectively. Maruti Suzuki has exported over 28,000 units of Baleno this year.
 
Among the companies, largest volume addition has come from General Motors. It has shipped 43,015 vehicles in April-November period, registering a 240 per cent growth over last year. India is fast becoming a major export hub for a number of manufacturers and GM India is no exception, Kaher Kazem, president and managing director, GM India said last month. GM India, like Volkswagen, Ford and Nissan, sells more India made vehicles outside than in the country.  
 
Srivastava said the rising volumes in the domestic and export market is improving the economies of scale of companies and making the country a more competitive base for export of quality products.

 

Sources :.business-standard.com

India To Export 220 Mw Electricity To Nepal

India is all set to export an additional 220 MW electricity to Nepal in a bid to lessen the perennial power crisis in the energy-starved Himalayan nation.

Nepal will get 190 MW within three weeks and another 30 MW by another two months.

Nepal currently imports 300-320 MW electricity from India, the Indian embassy said in a tweet.

Both governments are working towards increasing this amount by additional 250 MW in next two months.

The electricity from India will be imported through various cross-border corridors.

Though Nepal has huge potential of generating hydro energy of over 80,000 MW round the year, it could not harness more than 800 MW as against the winter demand of more than 13,00 MW. The poor rate of production is attributed to lack of political consensus, instability and resource crunch.

Nepal is going through power cuts of more than 13 hours a day in winter season, but has been managing the power crisis during rainy seasons as its power stations run in full capacity.

After an upgrade of the Muzaffarpur-Dhalkebar cross border transmission line, Nepal and India will be able to export and import more energy.

The completion of this power corridor will allow Nepal to significantly increase its energy imports from India. Nepal is currently importing 80 MW  from this station.

During a meeting in November in New Delhi, the Indian side had agreed to add 220 to 250 MW electricity to Nepal, a senior Nepal government official said.

As part of that agreement, India’s Power Trading Corporation had agreed to provide 30 MW electricity round the clock from Tanakpur substation located in far west of Nepal from Uttarakhand.

Several cross-border transmission lines are proposed between Nepal and India, and some are already under construction.

 

Sources :hindustantimes.com

Zero Import Duty On Wheat Will Lead To Dumping: Unions

 Farmers’ unions and agriculture experts are anguished over the Centre’s decision to scrap the import duty on wheat as they fear that farmers’ income will be affected and they will have to resort to distress sale during the rabi season.

The All India Kisan Sabha said government agencies had failed to procure wheat at the minimum support price (MSP), and without an adequate number of open purchasing centres, farmers are forced to sell their crop at lower prices.

“The decision of scrapping the import duty ahead of the winter wheat crop is aimed at helping agri-businesses by dumping wheat from foreign countries in India,” AIKS president Amra Ram said.

He said that big players in the wheat flour market had been demanding withdrawal of the duty, and this move was to suit their interests.

The Centre recently announced zero import duty from the prevailing 10 per cent to improve domestic availability and check rising prices of wheat and wheat-based products.

“Wheat traders are expecting imports to cross five million tonnes this year. The cost of imported wheat would be far below the MSP of ongoing rabi (Rs. 16,250 a tonne), resulting in crashing domestic wheat prices as the government has no effective procurement mechanism in many States,” he said.

Detrimental step

Nirbhay Singh, leader of the Kirti Kisan Union in Punjab, said, “With easing norms for wheat imports, the government has taken a detrimental step towards farmers’ interest. We have seen it in every season that though the government promises to buy crop at the MSP, yet farmers sell their produce in distress at a lower price for various reasons,” he said.

Agriculture experts also expressed concern over the Centre’s decision and apprehended that the move could badly hurt farmers’ income.

“The government has been saying that wheat sowing has not been impacted by demonetisation and the area of cultivation has increased. If the area has actually increased, and there are no other indications that wheat production will be down in the ongoing season, then why is the government allowing import of duty-free wheat?” asks Ajay Jakhar, chairman of Bharat Krishak Samaj.

“It will lead to a drop in wheat price by at least Rs. 250 per quintal in the open market,” he added.

Devinder Sharma, noted agricultural and food policy analyst, said: “Scrapping duty on wheat would be detrimental to Indian agriculture. First, we did it with oilseeds then with pulses and now with wheat. Importing wheat will hurt our farmers.”

“Prices of wheat have been going up due to the government’s failure. But the farmers should not be penalised for that,

 

Sources :thehindu.com

Rupee Trades Near Fresh Low Against Us Dollar

Mumbai: The Indian rupee on Monday was trading near a fresh record low against the US dollar, amid nearly $5 billion outflows from foreign institutional investors (FIIs) in local equity and bond markets since the government announced the demonetisation scheme.

The FIIs are selling local as well as other emerging market assets on rising expectations of a possible US interest rate hike in its next mid-December policy and as speculation mounts that US president-elect Donald Trump’s reflationary policies will mean a quicker pace of monetary tightening by the Federal Reserve. The concern that he will take a more protectionist approach to trade has also weighed on developing-nation assets.

At 2.30pm, the rupee was trading at 68.74 a dollar, down 0.3% from its previous close of 68.47. The home currency opened at 68.43 against the US dollar and touched a low of 68.80 a dollar. So far this year, it has fallen 3.7%.

Barclays expects that the currency volatility could increase and liquidity could become scarce during bouts of market risk aversion and dollar strength, as the market tests the new Reserve Bank of India (RBI) leadership’s tolerance for weakness in the rupee.

“Unless the RBI hints at greater tolerance of larger rupee depreciation, we continue to hold a constructive medium-term view on the INR and see it as one of the most resilient EM currencies in a strong dollar environment. Potential anti-immigration and anti-trade policies in the US would not bode well for developing economies, and the dollar likely would strengthen next year—particularly against EM currencies. Rupee is unlikely to ‘escape the beta’ (to the USD) and likely also would drift higher as the rest of USD/EM FX adjusts, especially if the market sees the RBI as continuing to be less tolerant of rupee appreciation than it is of rupee depreciation,” said Barclays report.

India’s benchmark Sensex index was trading at 26,333.75 points, up 0.05% or 12.82 points from its previous close. So far this year, it has fallen 1%.

Traders are also cautious ahead of the key gross domestic product (GDP) data which will be released on 30 November. According to Bloomberg estimates, GDP will be 7.6% for the September quarter from 7.1% in the June quarter.

Bond yields gained after the RBI on Saturday unexpectedly ordered banks to deposit their extra cash with it, in a bid to absorb excess liquidity generated by the government ban on larger banknotes.

The central bank said banks would need to transfer 100% of their cash under the RBI’s cash reserve ratio from deposits generated between 16 September and 11 November, saying it was a temporary measure that would be reviewed on or before 9 December.

Traders called it a drastic move intended to dent the rally in bond markets, adding that the RBI could have opted for more modest measures such as sucking out some of the liquidity through sales of market stabilisation bonds or telling banks to park funds under reverse repos, Reuters reported.

The benchmark 10-year government bond yield gained 8 basis points, to 6.343%, compared to Friday’s close of 6.231%. Bond yields and prices move in opposite directions.

So far this year, FIIs have bought $4.57 billion in equities and sold $3.02 billion in debt.

Most Asian currencies advanced as the dollar index and US treasury yields dropped, while oil prices declined after a planned meeting on Monday between OPEC and non-OPEC producers was cancelled.

Japanese yen was up 1.23%, South Korean won 0.6%, Taiwan dollar 0.33%, Singapore dollar 0.33%, China offshore 0.3%, China renminbi 0.25%, Indonesian rupiah 0.2% and Thai baht rose 0.2%. However, Malaysian ringgit was down 0.08%.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 100.79, down 0.69% from its previous close of 101.49

 

Sources :.livemint.com

India Imports 17.2 Lakh Tonnes Of Wheat This Year

 Indian flour mills have imported 17.2 lakh tonnes of wheat from Ukraine, Australia and France so far this crop year to meet domestic shortages.

Additional 6-7 lakh tonnes of wheat shipments are expected to arrive in the coming months of the 2015-16 crop year (July-June), taking the country's overall imports to 24 lakh tonnes this year.


Last year too, private flour millers had purchased about 5 lakh tonnes of wheat from Australia for the first time in a decade, due to sluggish supply of domestic high protein wheat and lower international prices.

"So far, 17.2 lakh tonnes of wheat has been imported from Ukraine, Australia and France. We need more and additional 6-7 lakh tonnes are expected till February," Roller Flour Millers' Federation of India Ex-President M K Datta Raj told PTI.

Of the total exports till date, about 10.7 lakh tonnes were purchased from Ukraine, 5 lakh tonnes from Australia and 1.5 lakh tonnes from France.

Wheat imports are being undertaken to meet domestic shortages and moreover the grain is available in the global market at much lower than the local prices, he said.

For instance, imported red wheat was costing Rs 1,880 per quintal for delivery in Bengaluru, while the local wheat was quoting higher at Rs 2,060 per quintal.

Similarly, imported white wheat was costing Rs 2,080 per quintal compared with Rs 2,400 per quintal delivered from Uttar Pradesh.

Stating that more import deals are expected in the coming months, Raj said this is because state-run Food Corporation of India (FCI) has restricted wheat sale to bulk users.

He also demanded that if the government further brings down the import duty on the grain to zero from the current 10 per cent, more wheat could come from abroad.

"Weakening of rupee is increasing the cost of imports. It would be better if the government soon takes a call on this issue," he said.

FCI is selling more wheat in North India to check retail prices of wheat and wheat flour, which have shot up by 23 per cent in the last one year.

For instance, retail price of wheat in Delhi has gone up to Rs 24 per kg from Rs 19 per kg in the year-ago period. Similarly, retail price of wheat flour has increased to Rs 27 per kg from Rs 21 per kg, as per the government data.

Rising wheat imports and spike in retail prices indicate short fall in the domestic output in the 2015-16 crop year, but the Agriculture Ministry has maintained production to be 93.50 million tonnes despite drought in over 10 states.

At present, the country is consuming the wheat grown in 2015-16 crop year. The new crop is being sown at present and will arrive in the market only in April.

 

Sources :.business-standard.com

Handloom & Handicraft Industry Eyes New Markets For Exports

 The Textiles Ministry is looking to concentrate on new markets and opportunities for local handloom and handicraft sector as many global companies are willing to tie-up with Indian weavers and artisans. “There is a huge scope for promoting Indian handloom and handicraft products in the niche markets world over,” said Rashmi Verma, Textiles Secretary, at an Assocham event held in New Delhi on Friday.

While most of the sectors registered a decline in exports of Indian products to global markets, export of handicrafts continued to grow at the rate of 17 per cent. “All stakeholders should make efforts to engage with artisans and weavers in the country and hand-hold them not only for ensuring that they get right price and market for their products and also get recognition which they deserve in the world and domestic markets,” she added.

The Union Textile Ministry has signed memorandum of understanding (MoU) with 20 e-commerce companies to engage with artisans and weavers in different handloom and handicraft clusters across India and help them market their products directly. “This will go a long way in ensuring that they get the right price for their product as they are able to sell their product directly to the consumer,” said Verma.

The government is also taking steps for skilling weavers, for giving them design inputs, quality raw material, tools and upgrading their looms to empower them so that they continue to remain engaged in this craft.

“We are finding that younger generation is slowly getting disinterested in this sector and are moving towards information technology (IT). The Textiles Ministry has taken an initiative for training children of weavers and artisans to become entrepreneurs so that they can emerge as leaders in producers’ groups and market their products through e-commerce and other channels directly. This is also in one way trying to attract children of weavers and artisans back into this trade,” she said.

She further said that there are a number of design workshops especially for the weavers and artisans whereby they are informed about current market trends and demand of the market because they have to be sensitised to the needs of the market and only then they will be able to produce what the consumer wants and not try to sell whatever they have made.

According to Textile Ministry’s analysis, many of the weavers and artisans have become workers and labourers in the hands of traders or exporters. “They get paid wages on a daily basis on whatever work they do in one day, so instead of selling their craft and talent, they are now selling their labour, as a result, this has disinterested the young generation,” she said.

Dependence upon middle men for raw material, working capital and even the design are other factors forcing the weavers and artisans to sell off their talent and craft. “It is very-very important that we all together take steps so that dignity of the weaver and artisan is restored and we empower them to be able to sell their talent and their products and not their labour,” stated Verma.

She added, “Sometimes, it is important to have these traders and exporters because they give them the kind of market which these products deserve but it is also important to ensure that these people continue in the tradition of handloom weaving and handicrafts by empowering them by ensuring that they get working capital, are able to get good designs and also have a marketing nexus of their own.

 

Sources :.business-standard.com

Pakistan Stops Import Of Cotton From India Amid Tension

Pakistan has suspended the import of cotton and other agriculture commodities, including vegetables, from India due to rising tensions between the two countries along the LoC, a media report here said.

Officials of Department of Plant Protection (DPP) said that import of agri items from India through the Wagah border crossing and Karachi port and issuing permits for future imports has been halted, the Dawn reported.

Cotton importers and customs clearing agents claimed that the department had stopped the import of agriculture commodities from India without a warning or written order because of increase in tensions across the LoC.

Imran Shami, chief of DPP which is a subordinate department of the national food security and research ministry, however sought to dispel the impression.

"We have stopped import of tomatoes and other fresh vegetables in order to protect our farmers. We have enough tomato and other vegetables stocks, which we import from India only in case of shortages in the domestic market," he said.

The reason behind the "suspension" of cotton imports from India was, nevertheless, different, he said.

"No. We have not stopped cotton imports from India. It has just been halted over reports that the Indian exporters are not meeting our bio-security conditions. We're looking into these reports and will lift restriction on cotton imports if our apprehensions are proved wrong," Shami said.

He said only those cotton consignments would be allowed to enter Pakistan through surface or sea routes where importers had already secured permits from his department and carried phyto-sanitary certificates.

"Our cotton consignments are not being allowed to enter Pakistan through Wagah and Karachi for reasons known to the ministry but cheaper, subsidised Indian yarn is being brought in without any let or hindrance. At least 11 trucks of Indian yarn entered Pakistan on Thursday when the department stopped cotton consignments from coming to this side of the border," a textile factory owner told Dawn.


He said the suspension of cotton import from India would create a huge problem for the textile exporters as the truncated domestic crop target of 11.25 million bales for this year appeared difficult if not impossible to meet.


"The industry requires 14 million bales. We will still be short by three million bales of cotton even if the crop target is achieved," he said.
Top Comment
Dear Mr. Modi, you keep harping on the sacrifices of the Indian Soldiers at the Indo - Pak Border why have you not till date taken away the MFN status given to Pakistan. Again Pakistanis have snuubed... Read MoreSanjeev Sikka


He said cotton shortages after the ban on Indian imports would make domestic prices shoot up at the expense of exports.


Pakistan had imported 2.7 million bales of cotton (1 bale is 170 kgs) - about 40 per cent of India's total cotton exports in 2015-16 - due to crop failure that wiped off 0.5 per cent of GDP growth. The industry is expecting to import 2 million bales this year.
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Officials of Department of Plant Protection (DPP) said that import of agri items from India through the Wagah border crossing and Karachi port and issuing permits for future imports has been halted, the Dawn reported.

Cotton importers and customs clearing agents claimed that the department had stopped the import of agriculture commodities from India without a warning or written order because of increase in tensions across the LoC.

Imran Shami, chief of DPP which is a subordinate department of the national food security and research ministry, however sought to dispel the impression.

"We have stopped import of tomatoes and other fresh vegetables in order to protect our farmers. We have enough tomato and other vegetables stocks, which we import from India only in case of shortages in the domestic market," he said.

The reason behind the "suspension" of cotton imports from India was, nevertheless, different, he said.

"No. We have not stopped cotton imports from India. It has just been halted over reports that the Indian exporters are not meeting our bio-security conditions. We're looking into these reports and will lift restriction on cotton imports if our apprehensions are proved wrong," Shami said.

He said only those cotton consignments would be allowed to enter Pakistan through surface or sea routes where importers had already secured permits from his department and carried phyto-sanitary certificates.

"Our cotton consignments are not being allowed to enter Pakistan through Wagah and Karachi for reasons known to the ministry but cheaper, subsidised Indian yarn is being brought in without any let or hindrance. At least 11 trucks of Indian yarn entered Pakistan on Thursday when the department stopped cotton consignments from coming to this side of the border," a textile factory owner told Dawn.


He said the suspension of cotton import from India would create a huge problem for the textile exporters as the truncated domestic crop target of 11.25 million bales for this year appeared difficult if not impossible to meet.


"The industry requires 14 million bales. We will still be short by three million bales of cotton even if the crop target is achieved," he said.
Top Comment
Dear Mr. Modi, you keep harping on the sacrifices of the Indian Soldiers at the Indo - Pak Border why have you not till date taken away the MFN status given to Pakistan. Again Pakistanis have snuubed... Read MoreSanjeev Sikka


He said cotton shortages after the ban on Indian imports would make domestic prices shoot up at the expense of exports.


Pakistan had imported 2.7 million bales of cotton (1 bale is 170 kgs) - about 40 per cent of India's total cotton exports in 2015-16 - due to crop failure that wiped off 0.5 per cent of GDP growth. The industry is expecting to import 2 million bales this year.
Stay updated on the go with Times of India News App. Click here to download it for your device.

 

Sources :timesofindia.indiatimes.com

India's April-September Tea Exports Drop By 2%

NEW DELHI: India's tea exports declined by 2 per cent to Rs 2,084.06 crore in the first six months of the current fiscal.

In the April-September period of last year, the total value of tea exports was Rs 2,124.97 crore, according to Tea Board's latest data.

In terms of quantity, the exports have dipped to 101.04 million kg from 106.36 million kg in the corresponding period last fiscal.

As per the Tea Board, the exports in value terms remained slightly higher in the six-month period of the 2016-17 fiscal on better unit value realisation.

The export realisation was Rs 206.26 per kg as against Rs 199.79 per kg a year ago.

Tea export from North Indian states -- Assam, West Bengal and others - was marginally lower at 58.10 million kg in the April-September period as against 58.38 million kg in the year-ago period.

 Similarly, the overseas shipment from South Indian states -- Tamil Nadu, Kerala and Karnataka -- was down at 42.94 million kg as against 47.98 million kg in the said period.

Whereas, tea production is estimated to have been 795.89 million kg in the first six months of this year, which is almost same as it was in the year-ago period.

India is the second-largest tea producer in the world after China, with over 70 per cent of the beverage produced, being consumed in the country itself.

In the full 2015-16 fiscal, the country sold 232.92 million kg in the overseas market and the export realisation was about Rs 4,493.10 crore.

 

 

Sources :economictimes.indiatimes.com

Rupee Opens 5 Paise Up At 68.11 Against Dollar

NEW DELHI: Indian rupee opened nearly 5 paise up at 68.11 against dollar on Tuesday on account of some selling of American currency by banks and exporters. Meanwhile firm opening of domestic equity markets also supported sentiments.

At 9.15 am, rupee was trading 3 paise up at 68.13 against dollar. Benchmark equity indices BSE Sensex and NSE Nifty were up by 163.02 points and 60.05 points at 25928.16 and 7,989.15.

On Monday, the local currency slipped for the second straight day and closed 3 paise down at 68.16 against dollar. In cross-currency trades, rupee gained against the pound sterling to finish at 84.14 against 84.66 on last Friday, but fell against the euro to settle at 72.79 as against 72.37. It strengthened further against the Japanese yen and close at 61.62 against 61.72 per 100 yens earlier.

According to market experts, sustained foreign money outflows mainly affected the rupee movement against the dollar on Monday. However, weakness of dollar in the international market capped the rupee fall against the dollar. Foreign portfolio investors stood net seller on Monday and sold shares worth Rs 873.11 crore, according to the data available with NSDL.

HDFC Securities in a research note said, "We advise trader to remain long in USDINR Nov. Fut. for new all time high target above 69.21, keeping a stop loss at 67.50 on closing basis."

 
The 10-year benchmark bond yield eased further and opened at 6.28 per cent on Tuesday against previous close of 6.30 per cent

 

Sources:economictimes.indiatimes.com

Steel Imports Drop 39% To 4.5 Million Tonnes In April-October

NEW DELHI: Helped by steps to protect the industry, steel imports have declined 39 per cent to 4.5 million tonnes during April-October of this fiscal over the same period a year earlier.

"The government has taken various steps in the interest of the domestic steel industry from unfair foreign competition and the same have yielded positive results," Steel Minister Chaudhary Birender Singh said in a reply to the Lok Sabha.

Price realisation has improved, imports of steel have declined by 39 per cent to 4.5 million tonnes (mt) during April-October 2016 as against the corresponding period last year, the minister said.

Since the beginning of 2014-15, the Indian steel industry has witnessed severe stress due to surge in imports from countries saddled with excess capacity and fall in domestic prices.

In India, steel prices of HR coils fell to Rs 30,000 in January 2016, from a high of Rs 47,000 in April 2014.

Volume of steel imports increased to 11.71 mt in 2015-16, from 5.45 mt in 2013-14. With the decline in domestic steel prices, the net sales realisation and profit margins of domestic steel producers fell and the erosion in profit margin for the steel companies significantly decreased their debt servicing capability.

"The government has various export promotion schemes like Merchandise Exports from India Scheme (MEIS), duty exemption scheme, interest equalisation scheme etc under the Foreign Trade Policy 2015-20 which are also available for export of iron and steel goods," he said.

 

Sources :economictimes.indiatimes.com

Micromax To Start Making Smartphones In India By March 2017

NEW DELHI: Micromax Informatics is planning to make smartphones on a completely knocked down or CKD basis in India, by March next year, which could make it the first local manufacturer to take the plunge in the market where all but only Samsung is assembling phones.

"We're on the verge of importing our first set of CKD units," Micromax co-founder Vikas Jain said, adding that the company was looking at beginning before the end of the financial year.

"While we are working on logistics and building infrastructure, it will be at our new facilities either at Telangana or Bhiwadi," he said. The company is yet to decide the capacity of production from CKD units but is expecting its first shipment of CKD units soon. The move will be a step up in value addition for the home-bred handset maker, which makes 3 million phones a month in Rudrapur and Telangana factories, more than half of which falls in the smartphone category.

The company's third plant is set to come up in Bhiwadi, Rajasthan, and the fourth one in Bhopal, Madhya Pradesh. An investment of Rs 2,000 crore has been marked out for making phones and electronics such as televisions, tablets and accessories locally, over the next five to six years.

At present almost all companies that sell phones in India, either import fully built units or semi-knocked down (SKD) phones from China, which can be assembled together with little manufacturing requirement. The process, however, is labour intensive and therefore offers jobs in large numbers to
fairly low skilled workers.

Making phones from completely knocked down (CKD) versions, involves mounting of components onto a printed circuit board (PCB) mechanically, where
the PCB and other components are required to be imported separately from China, and then put together. In terms of value addition, CKD is a step above SKD, and lays the groundwork for assembling components that in turn go into making handsets.

"PCB assembly done locally can provide a 2% cost improvement on bill of material, which can in turn reduce overall cost of the phone," Tarun Pathak, senior analyst at Counterpoint Research said.

The move will aid in quality control and better control on design, which local handset makers have begun to do in house.

 

Sources :economictimes.indiatimes.com

Cash Crunch Puts Brake On India's Cotton Exports; Rivals To Gain

Exports of 1 million bales of cotton from top producer India have been delayed after a government move to ban high-value currency notes prompted farmers, who prefer cash payments, to postpone sales, industry officials told Reuters.

The supply crunch has driven up prices in India to levels higher than in the global market and could force buyers to switch to other producers like the United States, Brazil and African countries. It could also curb India's total exports in the 2016/17 year marketing year that started on Oct. 1.

"Supplies are very limited in the market. Farmers are not selling cotton right now as they need payments in cash and it is not available," said Chirag Patel, chief executive officer of Indian exporter Jaydeep Cotton Fibers.

Earlier this month, Prime Minister Narendra Modi scrapped 500 rupee and 1,000 rupee bills to crack down on corruption. But the move disrupted trading of farm commodities like cotton and soybean as most farmers prefer payments in cash.

"November remains a peak supply month but now supplies have stopped due to the cash crunch. We are ready to give farmers cheque, but they are insisting on cash," said Pradeep Jain, a ginner based in Jalgaon in Maharashtra.

Expecting a bumper crop of 35 million bales, Indian traders had contracted 2 million bales for exports to China, Vietnam, Bangladesh and Pakistan for shipments in November to January. But traders have managed to ship only around 300,000 bales and nearly 1 million bales that were due to ship in November and December are getting delayed, three exporters told Reuters.

India's inability to ship promptly could force buyers to switch to other suppliers like Brazil and the United State, said Keith Brown, principal at cotton brokers Keith Brown and Co in Moultrie, Georgia. "In fact, this may be one reason why U.S. cotton is going higher at harvest time."

New York cotton futures last week touched a high of 72.75 cents per pound, the loftiest since August. They have risen about 5 percent over the past fortnight, versus a 10 percent gain in Indian prices.

The surge in local prices is also making signing new export deals difficult for India as overseas prices are lower than local prices, Jaydeep Cotton's Patel said.


The disruption in exports will have an impact on global prices as it reduces the overall supply, said Rebecca Pandolph, statistician of International Cotton Advisory Committee. "How much of an effect will depend on how long the situation lasts."


However, industry officials say the crunch is temporary and prices will moderate as India is set to harvest a bumper crop. Last year, the country shipped out 6.9 million bales.


"The Indian crop is still very big and if price pressure doesn't come now, then it's only being delayed and that pressure will arrive at some point,

 

Sources:timesofindia.indiatimes.com

Hyundai India Targets To Roll Out Its 10 Millionth Car By H1 Of 2021

 Hyundai Motor India Ltd (HMIL) sets a target of rolling 10 millionth car by the first half of 2021 from its Sriperumbudur manufacturing facility, near Chennai, from where the company on Monday rolled out its seven-millionth car.

Creta AT got the distinction of being the seven-millionth car.

With this, HMIL has achieved the second best position in Hyundai Motor group amongst its overseas peers, only after China. It is also the first auto manufacturer in India to achieve this feat in a record time within 18 years of commercial operation.

It may be noted, HMIL rolled out its first millionth car, a Santro, in 2006 just eight years after commencement of commercial production in 1998.

Thereafter, production picked up momentum, with the next millionth milestone being achieved within an average of 18 -19 months. The five-millionth car was flagged off in October 2013.

Managing director and Chief Executive Officer of HMIL, Y K Koo, said, " HMIL has always set new benchmarks in terms of quality and customer delight by introducing new products with new technology and design to the Indian market, demonstrating superior manufacturing prowess. Our 'Made in India' products have impressed global and Indian customers alike."

"We now have to move to realise our vision as announced during our 20th year of foundation on May 6th, 2016, of being the Market Leader, Great place to work, Most loved and trusted the brand with Modern premium brand essence to touch 10 million units within the first half of 2021," Koo added.

HMIL has held the top exporter position consistently for 12 years since 2004 with a volume of 24,64,723 to date. It currently has ten car models across segments — Eon, i10, Grand i10, Elite i20, Active i20, Xcent, Verna, Creta, Elantra, Tucson and Santa Fe. HMIL's fully integrated manufacturing plant forms a critical part of HMC's global export hub.

It currently exports to around 92 countries across Africa, Middle East, Latin America, Australia and the Asia Pacific.

 

Sources :business-standard.com

Eow Starts Probe Into Rs 50Cr Sugar Export Scam

 The economic offences wing (EOW) of the city police has begun investigation into the alleged fraudulent export of two lakh tonnes of sugar by 21 sugar factories in the state. The fraud was initially estimated at around Rs 22 crore, but the police believe it may go up to Rs 50 crore.

Principally, sugar was exported in 2007-08 at rates lower than market prices, but the transport company was paid at rates higher than that prevalent at the time. Around 200 accused have been listed, including the chairmen, managing directors and directors of the 21 factories in Kolhapur, Sangli, Satara, Ahmednagar, Solapur and Pune.


An advocate, Govind Patil, had filed the case with the police. "The modus operandi was that over two lakh tonnes of sugar were sold to Kenya, Tanzania and Sri Lanka at a much lower price than the market rate in India. Moreover, the transportation fees given to M/s Shakti Credit Limited were much higher than market rates. During our initial probe, we found that it was the transporter's firm that had brought the proposal of export and the remaining work was done with its help," said a police officer.


A Kolhapur resident, Vasant Apte, had filed a petition in the Bombay high court in 2008 seeking a probe. The HC directed the Sugar Committee to inquire. During its second inquiry, sugar commissioner Raj Gopal Deora found a loss of crores and the court ordered Mumbai police to probe. "After a preliminary inquiry, we registered a cheating case in August 2016 against the chairman, managing directors, directors and office bearers of M/s Shakti Credit. We have written to all the sugar factories to furnish records of all exports during 2007-08 and are waiting for their reply. We have also made an office bearer of the Maharashtra Sugar Federation an accused," added the officer.


The sleuths said they are trying to track how Shakti Credit got the tenders for the exports, mainly through JNPT, Kandla and Port Bundar ports. The role of some officers of the Indian Sugar Export-Import Pvt Ltd is under probe.

 

 

Sources ; timesofindia.indiatimes.com
 

India Needs Strategy For Dal Production; Here’S Why

There is by now substantial agreement amongst analysts that a strategy for dal production which ensures supplies and a reasonable degree of self-reliance is sorely needed, and the country cannot go from one crisis to another without a well-worked-out policy.

However, the discussion is flawed on its assessments of what governments can and cannot do and on the lack of a short and medium strategy to enhance production. Former CACP chairman Ashok Gulati has endorsed the proposal that government use a fund to stabilise prices. But India’s pulse problem is not contracyclical. Funds work if you have to support prices in one year and sell in another to replenish your fund. The pulses problem is of an endemic shortage which keeps on rising. You will need subsidies and not funds. Earlier imports where around 2 million tonnes; but now they are in the range of 3.5-4.5 million tones and we are running on a downstairs case, so more maybe ahead. Again, governments have been notoriously poor managers of contracyclical policies. My friend Sanat Mehta, who passed away recently, set up a committee under me to solve the groundnut oil problem in Saurashtra. I wanted a contracyclical fund. Shankar Lal Guru, then a prominent market regulator of the Unjha market-yard, told me, “When I trade in mungphali (groundnut), even my munim does not know whether I am buying or selling. But your minister announces his policies, and so we are able to fleece him.”

Second, they want imports. If your policies are as bad as they have been, you will need imports. Since imports are expensive, and particularly given we are poor importers, the need for subsidies for urban consumers is felt. But that will give very wrong signals to the country’s farmers. Incidentally, imports and subsidies will subsidise foreign farmers, in Canada, the US, Australia as also in East Africa and Myanmar. India’s own farmers will suffer. It is like pouring water into a leaking bucket. We will give negative signals before the next rabi season to our agriculturists. They already get the wrong signals, as Gulati points out, from the government’s support to wheat, and a partial import policy will make matters worse. It is of some importance that imports are made with a mild tariff and subsidised as they are even now.

No one is worried about the future. A committee I had chaired on pulses strategy, of which the report is printed, worked on a short- and medium-term strategy to enhance production; it also included a Bt pulses seeds strategy. The report is gathering dust, after some activity when Sharad Pawar was the Union agriculture minister.

Then, of course, our old friend, the Essential Commodities Act, is there. So, there are stocking limits. Not only for traders, but retailers, exporters, importers, implemented by a so-called reform-friendly, market-friendly regime. Some ‘show’ raids are done and the figures of pulses obtained are touted. Not a single grain of pulse has been added to the nations granaries, apart from those touted in the histrionics. If the past is any guide, and as many official reports have shown, such regulations are the major cause of black money. Also, may be, of corruption.

What is the government doing to enhance more production in the upcoming rabi season? Who is responsible for that, since the Planning Commission has been abolished? Unless perverted policies are followed, the price signals are there for the kisan. A seeds policy is essential, as also availability of pesticides, as Rallis has shown in its I Shakti producer companies, which come from a committee I chaired when Arun Jaitley was the minister of corporate affairs. What is happening to the 4 million kisans who have moved to census towns, thousands of them, each crying for market infrastructure; not the APMC structure, thank you? If the government were to support the kisan in what he does, it would never regret it. Can we assure him that the dal he produces will be purchased at 50% above the support price, way below the import price in terms of landed costs in the consuming centres? We supported him in 1975, 1988 and 2008 and he never let us down. Its time we got our act together again.

The author is chancellor, Central University of Gujarat and vice-chairman, Sardar Patel Institute of Economics & Social Research. He is also a former minister of power, planning, and science & technology.

 

Sources :.financialexpress.com

Early Drop In Mercury Turns Grapes Sour For Nashik Vineyard Owners

Nature continues to be unkind to the farmers of Maharashtra. After three successive years of hailstorms and drought, this year a good rainfall brought them some hope for their kharif crop

. But the parting kick of the retreating monsoon flooded their villages and farms and destroyed much of their produce. Now the unprecedented chill spreading across the state too early this season is fast destroying the hope of one section of farmers in Nashik—the grape growers.

Last week, grape producers from across the district had submitted a memorandum to Union roads and transport minister Nitin Gadkari to seek his intervention with the government and the Nashik District Central Co-operative Bank (NDCC) for extension of crop loans to one lakh farmers who had been left without funds at all. The NDCC has disbursed Rs 1740 crore worth of loans to farmers but fell short of funds following the government’s failure to make good the subsidy.

Nearly 75% of the grapes grown in Nashik, which is India’s grape county, finds its way to markets in Europe, making for about 60% of the total exports from India.

This is the month when farmers have to prune the vines to help the clusters to grow in proper proportion and without loans from the NDCC they do not have enough funds for these operations including for labour charges and pesticides. But while this man-made hurdle can be overcome, what is now worrying farmers majorly is the dipping mercury in the district which, on Monday was at 8.6 degree Celsius, the coldest after Ahmednagar at seven degrees Celcius.

Says Dinkarnath Aher, a farmer who has been in the business since 1985 with 25 acres of grape farms stretched across the Niphad tehsil, which is the main grape growing area in the country: “We cannot afford to have the temperature drop so suddenly. It damages the berries on the cluster which crack and this renders them useless for export. Moreover, if the temperature drops below eight degrees celsius, there is danger of powder mildew and other fungi taking over the crop which will lead to complete destruction of the produce which will not be fit for even the domestic market.”

Farmers at the moment are doing their best to save their crop by covering the vines in jute sacks and blankets, burning dead leaves beneath the vines to provide them warmth or using warm water to sprinkle the crop in the hope it will take away the chill. “But these are temporary remedial measures.”

The weather observatory has forecast further dips in temperature and that is worrying farmers about the future of their crops which will be ready to harvest in a month. But according to Jagannath Khapre, president of the Grape Exporters’ Association of India, the increasing frost in the air can cause injury to the berries and also slow down the metabolism of the vine. “The grape crop is generally harvested in 120 days. But the increasing cold slows down the metabolism and it can take about 160 days to harvest the crop, provided it has not been damaged by the chill.’’ Anything further than five degrees Celsius can condemn the entire crop to destruction, he adds.

Already the excess rainfall in some areas has left farmers with the prospect of less yields across the two lakh acres in the Banganga valley in Niphad tehsil which is all given over to the crop. Any further vagaries of weather would condemn them to virtually no yields at all, adds Aher.

Maharashtra is India’s largest grape producer and nearly 80% of the produce comes from Niphad in Nashik district though Pune and Solapur also grow some quantities of grape as does Bangalore in Karnataka. Normally such severe chill does not set in so early in the grape season and much of the clusters are fully grown before temperatures dip below 10 degrees Celsius. This year, however, the mercury has been falling steadily since Diwali. Farmers are left with little but to pray to the weather and sun god to save their crop.

 

Sources :hindustantimes.com

Demonetisation Impact: $1 Billion Worth Of Gold Imported So Far Since Nov 9

 A day after Prime Minister Narendra Modi announced that Rs 500 and Rs 1,000 currency notes would cease to be legal tender from the midnight of November 8 – a move aimed at cracking down on the flow of black money – those in possession of unaccounted wealth were seen rushing to jewellers to buy gold.

While these people were willing to pay huge premiums, jewellers were ready to accept old currency notes. The transactions took place on past-dated bills; even VAT was paid. As a result of this rush, there was a sudden spurt in demand for gold. According to market estimates, as much as $1 billion worth of gold, or around 30 tonnes, has been imported since November 9.
 
GFMS Thomson Reuters estimates that India’s gross official import of gold was worth nearly $1.5 billion as of November 14. Of this, as much as $900 million worth of the metal was imported after the demonetisation of high-value legal tenders. While this estimate does not exclude gold imported for exports, such gold would have been a small part of total imports. It should be noted that the government had last month said that for according the status of a nominated agency, the export of gold jewellery from export-processing zones (EPZs) and export-oriented units (EoUs)  would not be taken into account.

 
The country’s import of the yellow metal had stood at about $3.5 billion in October, according to GFMS Thomson Reuters estimates.
 
The demand for gold had dropped in India during pitrupaksha, a 15-day period considered inauspicious by the Hindus for purchase or sale assets. But it significantly increased after that period, especially in the days leading up to Diwali.
 
According to Shekhar Bhandari, senior executive vice-president and business head, global transaction banking and precious metals, Kotak Mahindra Bank, said: “Gold demand has been good since Diwali, and the trend continues. In the past few days, especially amid a marriage season, customers have been seen using debit cards to make payments for jewellery.” This trend is being seen widely among organised or big jewellers.
 
Meanwhile at Zaveri Bazar, Indian Bullion and Jewellers Association (IBJA) on Sunday sent messages to jewellers that there was the possibility of the income-tax department asking them to deposit old currency with it by November 15, to stop the malpractice of selling gold at a premium for banned currencies. The last date for depositing the banned currency notes with banks or exchanges has otherwise been fixed as December 30.
 
So far, however, there has been no official communication on this from any department, according Surendra Mehta, Secretary, IBJA. “No jewellers, to our best knowledge, are accepting old notes now,” Mehta said.
 
Against an average monthly import of 30 tonnes since February, October alone saw an import of an estimated $3.5 billion, or 56 tonnes, of gold.
 
No one is ready to predict the import trend in the coming weeks, as there are fears that the government might impose a ban on gold imports. However, there has been no official word on this so far.

 

Sources:.business-standard.com

India May Bail Out Recession-Hit Nigeria Against Oil Supply Business/Business/Economy

India may provide oil-rich but recession-hit Nigeria a $15 billion advance against future supplies of oil.

Nigerian Minister of State for Petroleum Emmanuel Ibe Kachikwu made the request when he met his Indian counterpart, Dharmendra Pradhan, during a recent three-day visit to New Delhi to discuss the significant potential if the two countries diversified their engagements in the hydrocarbon sector.

"The Nigerian Minister requested a potential investment by India of $15 billion, if the terms can be agreed to, in Nigeria, as upfront payment for crude purchases, to be repaid on the basis of firm term crude contracts over some years," a statement by the Indian Ministry of Petroleum and Natural Gas said. The ministry did not clarify whether the request would be accepted.

The two ministers, the statement said, agreed to work on a Memorandum of Understanding to facilitate investments by India in the Nigerian oil and gas sector that is expected to be firmed up this December during PETROTECH-2016.

The Indian High Commission in Abuja, the Nigerian capital, said Nigeria now provides 12 per cent of India's annual crude oil requirement. "India has the top spot at Nigeria crude oil exports with imports of 23 million barrels and 1.5 million barrels of other petroleum products, equivalent to 13 per cent of Nigeria's total export amounting to $9.94 billion for 2015-2016," the High Commission added.

The statement said Kachikwu also suggested more collaboration with India in the refining sector and exploration and production on a government-to-government basis by Indian companies, long-term contracts for supply of crude to Indian companies from Nigeria and also the possibilities of executing LPG infrastructure projects by Indian companies in Nigeria.

 

Sources :.business-standard.com

Rupee Closes Lower At 66.81 Against Dollar; Down 0.2%

 The Indian rupee on Thursday weakened against the US dollar, tracking the losses in its Asian peers.

The rupee closed at 66.81 against the US dollar, down 0.2% from its previous close of 66.68. The home currency opened at 66.69 a dollar. So far this year, it’s down 1%.

Most Asian currencies closed lower as traders are getting more focused on the US Federal Reserve rate hike in December as Hillary Clinton’s lead in the US presidential race remains intact after the last debate before the 8 November election. In the final presidential debate between Republican presidential candidate Donald Trump and Democrat Hillary Clinton, Trump tried to reverse the momentum in an election that polls show is tilting away from him.

South Korean won was down 0.38%, Thai Baht 0.32%, Japanese yen 0.26%, Philippines peso 0.19%, Singapore dollar 0.15%. However, Malaysian ringgit was up 0.08%.

India’s benchmark Sensex index closed at 28,129.84 points, up 0.52% or 145.47 points from its previous close. So far this year, it has gained 7.5%, while foreign institutional investors (FIIs) have bought $7.45 billion.

From 3 to 18 October, FIIs sold $1.17 billion in debt and so far this year they have sold $906.50 million.

The benchmark 10-year government bond yield closed at 6.76% compared to Wednesday’s close of 6.732%. Bond yields and prices move in opposite directions.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 97.93, up 0.01% from its previous close of 97.92.

The European Central Bank is seen leaving policy unchanged at Thursday’s review, investors will be looking for signals regarding the outlook for its quantitative-easing programme

 

Sources :.livemint.com

Arecanut Slide Hits Coffee Growers

 Coffee growers in Karnataka, earlier pinched by a drop in production and price, are now feeling the heat from a crash in price of arecanut, a major intercrop (growing in alternate rows or sections in the same field) for them

The price of arecanut (better known as the source for the betel nut or supari) has dropped over a year from nearly Rs 75,000 a quintal to Rs 25,000-30,000 a qtl. Around two-fifth of the country's crop (India is the world's biggest producer and consumer) comes from Karnataka.

Last week, Baba P S Bedi, former chairman of the Karnataka Planters Association (KPA), said it was a lucrative crop for quite a while till last year. Total demand in the country is estimated at around 1.2 million tonnes; output is around 700,000 tonnes.


India imported 67,824 tonnes worth $159 million in 2015-16, from 110,000 tonnes worth $230 mn in 2014-15. Growers say prices have come down due to slowing in the export market, especially regarding Pakistan. And, imports have risen from Sri Lanka. Traders import from Indonesia, through Sri Lanka, by getting a ‘Certificate of Origin’ from the latter. Imports from Lanka to India attract zero per cent customs duty, under a free trade agreement (FTA) with that country. 'Rule of Origin’ is permitted under the FTA with a provision that the exporting country must do a minimum value addition of 25 per cent.

Related restrictions on sale of tobacco and supari is given as another reason for a drop in demand and, therefore, the price.

Buying of arecanut is predominantly by traders and stockists, who try to do so when prices are low.

Rohan Colaco, earlier a KPA executive committee and a major arecanut grower, says there had been a rise in output over the years. Since the crops of paddy and maize are labour-intensive, farmers shifted to arecanut in the western ghat region. Also, over the years, quite a few sugarcane growers had converted to arecanut. In 2011-12, sowing was on 441,000 hectares; in 2015-16, this had risen to 473,000 ha.

 

Sources :.business-standard.com

Large Scale Imports Of Apis From China Worries Indian Pharma Industry

 Over-dependence of Indian pharmaceutical industry on imported pharma raw materials from China to meet the growing requirements of drug formulations is a cause of concern for the industry as well as policymakers.

India may have emerged as a key supplier of generic and affordable medicine for the world market, its overwhelming dependence on China for crucial raw materials, such as active pharmaceutical ingredients (APIs) and intermediates, to the extent of over 65 per cent of the requirement, has emerged as a main worrying area, according to an Assocham-RNCOS joint paper.

This is all the more disconcerting in the face of louder narrative against reducing trade gap with China which is well over $ 51 billion, added the study.

APIs and intermediates are key raw materials to manufacture pharmaceutical formulations such as tablets, capsules, syrups, etc. Rapid growth in new medical technologies is spurring the demand for generic drugs worldwide with the increased import of raw pharma ingredients from the emerging markets. Against this background, the policy makers have also raised concerns over India’s rising dependence on imports from China for many APIs that go into the making of a number of essential drugs.

Though the government has taken steps like withdrawal of exemption in customs duties, imports worth Rs 13,853 crore in 2015-16 or 65.29 per cent of the total imports of Rs 21,216 crore are not sustainable. “Over-dependence on China for APIs is likely to affect the bulk drug manufacturing sector, and subsequently have an impact on our population in plausible scenarios of drug shortages brought down by interrupted imports from single source country,” said D S Rawat, secretary general, Assocham, adding that over-dependence on such a crucial raw material on a single country is also not advisable from India’s overall strategic interests as well.

One of the main reasons for huge API imports from China is low cost of its manufacture and subsidy in China while India levies negligible import fee. “The import fees should be increased in line with other counterparts,” advocated the Assocham-RNCOS paper.

Presence of multiple regulatory authorities for the industry is also hampering the growth of the sector. The API manufacturers have to approach different authorities for renewal of licences that become a tedious affair. “Therefore, a single committee of various government departments should be formed to regulate the industry through a single window and audit of plants,” said Assocham.

Besides, the centre can focus on development of mega parks for APIs across the country. These parks should be provided with common facilities such as effluent treatment plants, testing, power plants, IPR management and designing. These facilities should be maintained by special purpose vehicles.

Several other countries like China provide incentives and subsidies for promoting the manufacture of essential pharmaceutical raw material. This significantly reduces their cost of production and ability to supply API to the world market at a huge discount to the global prices. This discourages new domestic investment in the sector.

 

Sources :business-standard.com

Centre Mulls Lowering Sugar Import Duty To Cool Down Prices

 To cool down sugar prices during the festival season and also thereafter, the Central government is exploring the option of lowering the 40 per cent import duty on the sweetener in its raw form.

Officials said the department of revenue in the finance ministry has been directed to explore the possibility of lowering the import duty considering all revenue implications.

By bringing down the import duty, the Centre hopes to increase supplies of the commodity.

Sources said the food ministry complete waiver of the import duty, while other department want a token duty to be maintained.

Data sourced from department of consumer affairs shows that wholesale price of sugar in Delhi and Kolkata markets along with some other Centres have moved up by Rs 30-50 per quintal in the last two months.

The Central government in a series of measures in the last six months has imposed a 20 per cent tax on sugar exports, withdrawn the excise duty concession on production of ethanol, imposed stock holding limits on sugar mills in addition to wholesalers and retailers as it felt that some mills along with few Centre feels that sugar mills along with few unscrupulous traders could further push up the prices during the festival season taking advantage of the supply shortage.

India's sugar production in 2016-17 season that started from October is expected to around 23 million tonnes as against 25 million tonnes of 2015-16 due to drought in major growing states of Maharashtra and Karnataka.

However, some industry players feels that there would be sufficient sugar stock to meet the domestic demand of 26 million tonnes in 2016-17 as the country would have an opening stock of 7 million tonnes. The Centre too till sometime back was of the view that their won't be any shortage of sugar in the coming months, but relentless rise in prices seems to have changed its mind.

Meanwhile, news agency PTI reported that union Cabinet Secretary PK Sinha on Wednesday directed the Department of Consumer Affairs to consider all options to check sugar and chana prices in the market.

State governments have been told to impose stock limits and take action against hoarders to ensure availability of all essential commodities during ongoing festival season.

Sinha reviewed the availability as well as the prices of essential commodities at a high-level meeting with secretaries of consumer affairs, agriculture, food, commerce, expenditure and others in the evening.

"It was observed that the recent measures taken by the central government have helped containing prices of most of the pulses, which are showing declining trends, and other essential commodities except chana and sugar," an official statement said.

According to government data, chana dal is currently being sold at an average price of Rs 110 per kg.

The maximum price is Rs 145 per kg. Sugar is available at an average price of Rs 40 per kg, although the maximum rate is Rs 47 per kg.

 

Sources :.business-standard.com

Rupee Closes Marginally Stronger At 66.68 Against Us Dollar

 The Indian rupee on Wednesday closed marginally stronger against the US dollar tracking the gains in the Asian currencies markets.

The rupee closed at 66.68 against the US dollar, up 0.07% from its previous close of 66.73. The home currency opened at 66.69 a dollar. So far this year, it fell 0.85%.

Most Asian currencies closed higher following government data that showed the Chinese economy grew in line with expectations for the July-September quarter.

Traders are cautious as Donald Trump and Hillary Clinton square off in the third and final debate before the presidential election.

South Korean won was up 0.56%, Japanese yen 0.51%, Philippines peso 0.4%, Thai baht 0.4%, Malaysian ringgit 0.19%, Indonesian rupiah 0.13%, Chinese yuan 0.07%, Taiwan dollar 0.06%. However, Singapore dollar was down 0.08%.

India’s benchmark Sensex index closed at 27,984.37 points, down 0.24% or 66.51 points from its previous close. So far this year, it has gained 7.15%, while foreign institutional investors (FIIs) have bought $7.42 billion.

India’s new monetary policy committee (MPC) was concerned about economic growth, and saw the downturn in retail inflation and slack in the economy as an opportunity to cut the key policy rate, according to the minutes of its first meeting released on Tuesday. All members leaned heavily on the Reserve Bank of India’s (RBI) staff surveys and reviews, which some analysts saw as a negative.

The goods and services tax (GST) council worked out a compensation formula for states and is now bracing for a testy debate on rates. The Centre has proposed a tiered rate structure with the rates varying from 4% for commodities like gold to 26% plus cess on so-called sin goods.

Since 3 October to 17 October, FIIs sold $1.15 billion in debt and so far this year they have sold $886.60 million.

The benchmark 10-year government bond yield closed at 6.732% compared to Tuesday’s close of 6.722%. Bond yields and prices move in opposite directions.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 97.76, down 0.13% from its previous close of 97.895.

Numbers released by the National Bureau of Statistics in China showed the third quarter gross domestic product (GDP) grew by 6.7% on-year and 1.8% on-quarter. Among other data released on Wednesday, China’s fixed-asset investment increased 8.2% nominally on-year in the January-September period, retail sales were up 10.7% on-year in September and industrial production increased by 6.1% on-year in September, missing markets’ expectation for a 6.4% rise, Reuters reported.

 

 

Sources :.livemint.com

Gjepc Seeks Exemption From Gem And Jewellery Exports, 1.25% Gst Rate For Local Transactions

KOLKATA: Gem & Jewellery Export Promotion Council (GJEPC) has sought exemption for gem and jewellery export transactions and 1.25% GST rates for domestic transactions even as the GST Council commenced a crucial meeting to set rates.

At present, gems & jewellery exports are effectively zero rated. Hence any element of tax in exports is required to be rebated. As regards VAT, it is typically charged at the rate of 1% on the sale price by almost all the states in India.
In its representation, GJEPC mentioned that export transactions should not be subjected to any effective GST as regards exports. All related consumption of raw materials, inputs and input services such as input of rough diamonds gold/ silver/platinum (through duty free export promotion schemes) at the input level should continue to be free from levy of any import duty/GST. In the representation, GJEPC has mentioned that all transactions, whether direct or indirect, for exports, should continue not to be taxed with any indirect taxes in the form of GST.

As regards transactions for domestic consumption (other than those meant for ultimately converging into exports), GJEPC, in its representation, has suggested that the preferred tax rates for different segments of the GJI should be nil for rough and cut and polished diamonds and coloured gemstones.. The body has suggested a GST of 1.25% for gold/silver/platinum jewellery (including studded jewellery and costume fashion jewellery). It has said that gold procured from nominated agencies for purpose of use in exports should continue to be exempted in line with the existing framework).

Mr. Praveenshankar Pandya, chairman, GJEPC said, “Considering that India has achieved a pre-eminent global position in the gems & jewellery exports and that 4.6 million of skilled & unskilled people are directly employed in the business, and GJI contributes 14% of the India’s merchandise exports, it is urged that as currently, all transactions, directly or indirectly, in the course of exports of the products of GJI, should not suffer any tax burden under GST. Considering the extremely high price sensitivity of the products of GJI and the various complexities in the manufacturing and distribution cycle, tax and fiscal policy makers in India have, over several decades, experienced and accepted that, for domestic transactions, a minimal indirect tax rate of 0 – 1.25% best ensures tax compliance and collection, while curbing the well known adverse economic impacts of higher taxation in the GJI. Given the high price of the products where around 80% - 95% of the content is imported component, diverse sensitivities that the gem and jewellery industry (GJI) faces as well as considering its economic and social significance, historically, the GJI has always been taxed at the very lowest level in the current system of indirect taxation.”

 

Sources :economictimes.indiatimes.com

Blue Revolution In India: White-Leg Prawn Boosts Marine Exports

Litopenaeus vannamei, the white-leg prawn originally a native of the Americas, is helping script a blue revolution in India. Fisheries scientists call it one of the biggest success stories of Make-in-India if the concept can be stretched to apply to aquaculture.

Introduced in India in only 2009, the vannamei variety now makes up for roughly 80% of the country’s shrimp/prawn exports and 46% of the outbound shipment value of all marine products, showed official data. The variety has been promoted immensely by the Marine Products Exports Development Authority both in India and abroad.

The variety’s success can be gauged from the fact that its export value has risen close to sixfold in the past four years through 2015-16 to $2.14 billion (see chart). In volume term, its exports have risen just over sixfold in these four years to to 2.57 lakh tonnes in 2015-16.

Encouraged by the success of vannamei, the government expects marine product exports to touch $10 billion by 2019-20, compared with $4.68 billion in the last fiscal. The US, the EU and Japan are the biggest markets for Indian shrimps.
Massive vannamei supplies have helped India’s marine exports maintain relatively good growth and prevent the overall farm export growth from sliding further in recent years. From just over 9% in 2011-12 (when vannamei exports started picking up), the share of marine products in the country’s overall farm exports rose to almost 15% in 2015-16. Marine items now form the largest segment of the overall agricultural export basket.

Even though vannamei exports value dropped in the last fiscal, thanks to the broader slide in commodity prices that affected per-unit realisation, the volume of the outbound shipments rose, suggesting robust demand.

graph

“Given the country’s extensive coastline, abundant marine resources and a tropical climate that lends itself to aquaculture production all year round, India has tremendous potential to be a leading global seafood player well-connected in distribution markets.
Vannamei will continue as the key contributor to the sector and is in growing demand as a candidate species in aquaculture in the coastal states of India,” Marine Products Exports Development Authority chairman Jayathilak A told FE.
He added that for a sustainable shrimp industry and to retain the unit value realisation of vannamei, the country needs to go for value addition in accordance with global demand.

 

Sources :financialexpress.com

Micra Most Exported Car Brand From India In September

 During the month of September, Nissan's Micra was the most exported car from India, followed by Ford's Ecosport and General Motor's Beat.

Over the last few years, the Japanese automajor Nissan and Ford of US have been on the top slots. Month-over-month, one of the two companies will be number one and two.

7,412 units of Micra were exported in September. Ford's EcoSport sold 6,837 units while General Motors' Beat sold 6,643 units.

Micra was launched by Nissan in 2010 and it was one of the successful products for the company both in domestic and export markets. From April to September 2016, Nissan has exported 39,017 units of Micra from India.

In September 2016, Nissan reported a 20 per cent growth in overall exports from India as compared to the same month one year earlier. Nissan Motor exported a total of 11,999 vehicles — including both Nissan and Datsun cars — in September. Nissan in India has a portfolio of two brands, Nissan and Datsun.

Guillaume Sicard, President, Nissan India Operations said, "Nissan is proud to contribute to the country's economy and the Make in India program by continuing to be one of the largest automotive exporters from India. Our strategy to use our plant in India as an export hub underlines our significant presence here and also demonstrates our long-term plans for growth. The Oragadam plant is the largest and most advanced in the Alliance, and directly and indirectly we have created 40,000 jobs in India, including 6,000 high value engineering jobs at our R&D centre."

Nissan earlier this year also announced the start of exports of the Datsun redi-GO to South Africa, Sri Lanka and Nepal, in addition to the Datsun GO and GO+.

 

Sources :.business-standard.com

Grape Exports From India: El Nino Set To Shower A Windfall

The country’s grape exports are expected to gain significantly this season owing to bad crop conditions in Chile, one of the largest exporters of grape in the world.

According to All India Grape Exporters Association president Jagannath Khapre, around 1.92 lakh tonne has been the peak of Indian grape export and the country is likely to cross this mark this year due to good monsoon and the prevailing good weather conditions in the grape growing regions. On the other hand, the table grape crop in Chile is expected to suffer a loss of 15% to 20% as a result of the unfavourable climate this season and the devastating impact of El Nino.

“Grape exports from Chile to the European Union is likely to be impacted this season because of the bad weather in that country. And if India plays its cards right, it could benefit and improve grape exports this year,” he said. Moreover, Russia and Bangladesh exports from India had reduced last year and if these countries increase export then again India could gain advantage, he added. The demand will rise, and if the currency improves, exports could rise, he said.

Last year, the country exported around 84,000 tonnes of grape to Europe. This number could improve by 5-7%, he said. The European Union (EU) has agreed to retain the residue levels of chlormequat chloride (CCL), a plant growth regulator at 0.05 ppm (papers per million), for a period of two years and this comes as a major shot in the arm for Indian exporters. In August this year, EU had proposed to change the pesticide residue levels in grapes to 0.01 ppm causing unrest among Indian exporters. In 2010, Indian grape exports faced a setback as EU was reluctant to accept Indian table grape consignments after chlormequat chloride was detected in excess of the prescribed maximum residue level (MRL). In 2009, EU had come up with more stringent regulations on pesticides. Unaware of the changed rules, Indian exporters who did not meet the new standards, faced rejection. However, less than 10% of the total export volumes were rejected.

Indian grapes began to find favour after 2014 when 1.92 lakh tonnes of grapes were exported by Indian traders to around 94 countries. Of this, Europe and the UK together accounted for the largest share of 65,000 tonnes.

In the overall grape exports from India, Nashik district recorded the highest ever export of 108,000 tonnes during the last grape season against 49,768 tonnes in 2014-15. Of the total 108,000 tonnes of the fruit, 75,000 metric tonnes were exported to European countries, while the rest 33,000 tonnes were shipped to countries like Russia, Bangladesh, China, Dubai etc.

At present, Canada has granted market access for the Indian fresh grapes. This follows the recent Indo-Canadian bilateral discussions held in New Delhi. However, the Indian exporters will be able to take advantage of this development only from the next season. Canada will open its market for the Indian exporters who have been shipping fresh grapes to European countries. Canada has also imposed conditions that exporters have to register the vineyards and pack houses, and maintain traceability.

The total area under grape plantation across the country is estimated at 3.50 lakh acres, including 2.75 lakh acres in Maharashtra and rest of the 75,000 acres spread in Karnataka, Andhra Pradesh and Telangana.

Total grape production of the country is estimated at 28 lakh metric tonnes, of which 22 lakh tonnes is expected from Maharashtra alone.

Meanwhile, grape growers have started the registration of vineyards with the agriculture department of the state for the 2016-17 season. The agriculture department has set a deadline of October 30 for the purpose. As per guidelines by the Agricultural and Processed Food Products Export Development Authority (Apeda), it is mandatory for grape exporters to register their vineyards for export.

 

Sourecs :financialexpress.com

Rupee Weakens Against Dollar Over Sell-Off By Fiis

The Indian rupee on Monday weakened against the US dollar after foreign institutional investors (FIIs) continued selling in debt markets. The fall in foreign exchange reserve also dampened the sentiments.

The home currency opened at 66.81 a dollar. At 2pm, the rupee was trading at 66.81 against the US dollar, down 0.15%, from its previous close of 66.72. From 3 to 13 October, FIIs sold $898.44 million in debt.

On Friday, Reserve Bank of India data showed foreign exchange reserves declined by a huge $4.343 billion to $367.646 billion in the week to 7 October, as the country gears up for a massive dollar outflow due to billions of dollars in deposits nearing their maturity. India had raised about $25 billion by way of three-year FCNR (foreign currency non-resident column) deposits in September 2013 to overcome the sharp fall in the rupee.

India’s benchmark Sensex index was trading at 27,578.97 points, down 0.34% from its previous close. So far this year, it has gained 5.6%.

India’s exports grew by 4.62% to $22.9 billion in September on the back of healthy growth in sectors such as engineering and gems and jewellery. Imports contracted by 2.54% to $31.22 billion, leaving a trade deficit of $8.33 billion in the month under review.

The benchmark 10-year government bond yield was trading at 6.754% same as that of Friday’s close of 6.754%. Bond yields and prices move in opposite directions. The rupee is down 1% till date this year, while FIIs have bought $7.57 billion in equity and sold $637.50 million in debt markets.

Asian currencies were trading lower. Malaysian ringgit 0.534%, South Korean won was down 0.490%, Taiwan dollar 0.396%, Philippines peso 0.367%, Indonesian rupiah 0.321%, Thai baht 0.15%, China Renminbi lost 0.168% and China offshore 0.166%.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 98.112, up 0.09% from its previous close of 98.019.

On Friday, Federal Reserve chairwoman Janet Yellen said there are “plausible ways” that running the US economy hot could fix damage caused by the Great Recession, laying out the argument for keeping monetary policy easy without taking an interest rate hike off the table this year.

Traders are cautious ahead of the data from China, including third-quarter gross domestic product (GDP), house prices, industrial production numbers, retail sales and fixed asset investment due this week.

 

Sources :.livemint.com

Handicrafts Exports To Grow By 10% To Rs 23,560 Cr In Fy17: Epch

NEW DELHI: With pick up in demand in the new and traditional markets, handicrafts exports will grow by about 10 per cent to Rs 23,560 crore in 2016-17, EPCH today said.

Exports Promotion Council for Handicrafts (EPCH) Executive Director Rakesh Kumar said that demand in regions like the US, Europe, Latin America and Middle East is growing and it will help in recording a healthy growth figures in exports.

For the April-September 2016 period, the exports reported a growth of 18.25 per cent year-on-year to Rs 13,005.35 crore.

"The promotional efforts being undertaken towards enhancing our exports in these markets would certainly result in increase in exports not only in the traditional markets but also in the emerging markets. This year, we are targeting the export figure of Rs Rs 23,560 crore," Kumar told PTI.

To boost the exports, the council has sough enhanced duty benefits for the sector, he said.

Talking about compliance issues in the sector, he said the council is taking lead in this direction by creating awareness through various seminars and other means.

Further the council is participating in 30-35 exhibitions and fairs abroad every year to promote the items in global markets.

"These participations remain both in traditional and not- traditional markets for Indian handicrafts. The participation in exhibition abroad is very much necessary to create awareness, brand image of the sector and to secure business for the sector,"

 

Sources :economictimes.indiatimes.com

Ford, Gm Lead India's Car Export Growth In H1 2016-17

NEW DELHI: Passenger vehicle exports from India grew 15.38 per cent in the first half of the ongoing fiscal with US auto majors Ford and General Motors emerging as surprise packages leading the charge, while their Korean and Japanese peers struggled to maintain momentum.

According to SIAM data, passenger vehicles exports in the April-September period were at 3,67,110 units as against 3,18,188 units in the year-ago period.

In terms of absolute volume, Hyundai Motor India remained the largest exporter with 87,499 units at a growth of 2.01 per cent.

The second largest exporter during the period was Ford India shipping 73,821 units, a growth of 32.25 per cent. Interestingly, the company's exports were much more than what it sold in the domestic market -- 46,422 units.

Maruti Suzuki IndiaBSE -1.43 % saw a decline of 7.87 per cent in its overseas shipments during the first six months of 2016-17 at 60,526 units, occupying the third slot.

The fourth largest exporter Nissan Motor India also witnessed a decline of 7.81 per cent at 49,611 units during the period.

The most significant gainer was General Motors India which clocked a massive 863.74 per cent jump in its passenger vehicle exports at 30,647 units during the period. In comparison, the company sold just 12,059 units in the domestic market, down 28.01 per cent.

According to SIAM, German auto major Volkswagen also exported more passenger vehicles from India than it sold in the country during the first half of the fiscal.

Volkswagen India exported 43,114 units in April- September, up 19.28 per cent. It sold only 23,329 units in the domestic market during the same period, up 0.45 per cent.

"Some of the OEMs are working on a clear, focussed strategy of exporting from India, which has worked out really well for them," Price Waterhouse Partner and auto expert Abdul Majeed told PTI.

He further said these companies are targetting markets in emerging economies such as Latin America, East Europe and Africa, which are similar to India with the products here.

"They have made those investments for exports and they already have big network in those export markets," Majeed said.

Concurring with him, Ford India Executive Director, Marketing, Sales, and Service Anurag Mehrotra said: "The most recent commencement of exports of Ford Figo as KA+ to Europe, from our state-of-the-art Sanand plant, showcases our continued investment and commitment."

 

Sources :economictimes.indiatimes.com

Indian Cotton Exports To Pakistan Slump Amid Tensions, Say Traders

Rising hostilities between India and Pakistan have brought their $822 million-a-year trade in cotton to a juddering halt, as traders who are worried about uncertainty over supplies and driven by patriotism hold off signing new deals.

The nuclear-armed rivals have seen tensions ratchet up in the past few months over the disputed territory of Kashmir, and cotton traders in both countries said they were watching developments along the de facto border with alarm.

Pakistan, the world’s third-largest cotton consumer, usually starts importing from September, but three Indian exporters said the number of inquiries had slowed to a trickle in the last two weeks.

In the clearest sign yet of souring relations affecting commerce, Pakistan-based importers also said they were not buying.

“At the moment there is no cotton trade. It’s at standstill. There is uncertainty that, God forbid, if war breaks out, what will happen?” said Ihsanul Haq, chairman of the Pakistan Cotton Dealers Association.

Pakistan Cotton Commissioner Khalid Abdullah said a “low quantum of trade activity is still taking place.”

He said the Pakistan government had not directed traders to stop buying Indian cotton and expected trade to normalize when tensions eased.

Indian government officials said they had not yet noticed trading had stopped.

But some Indian officials said last week that Prime Minister Narendra Modi’s government was considering whether it should choke trade with Pakistan to put pressure on its neighbour, even though the trade balance is in India’s favour.

India’ Biggest Cotton Buyer

Trade between India and Pakistan, which have fought three wars since their independence from British rule in 1947, is small.

In the 2015/16 fiscal year ending on March 31, official trade between the two was $2.6 billion. Cotton is the largest component of that total.

It is not clear whether other goods and commodities traded between the two, such as jewellery and dry fruits, have been hit by the escalation in hostilities as well, but the disruption to cotton shipments is potentially significant.

In the crop year ended Sept. 30, Pakistan was India’s biggest cotton buyer after its own crop was hit by drought and whitefly pest.

It imported 2.5 million bales from India, and supported Indian cotton prices at a time when China was cutting imports, traders said.

Lower purchases by Pakistan this year could hurt exports from the world’s biggest producer of the fibre and put pressure on Indian prices, but could also help rival cotton suppliers like Brazil, the United States and some African countries.

Chirag Patel, chief executive officer of Indian exporter Jaydeep Cotton Fibers, said the country could export 5 million bales in the 2016/17 crop year, but exports could plunge to 3 million bales without Pakistani imports.

An exporter based in Mumbai estimated that Pakistan will need to import at least 3 million bales in 2016/17, and India will have a surplus of around 8 million bales.

“As soon as the (political) situation improves, cotton trade will definitely resume between the two countries,” said Haq of the Pakistan Cotton Dealers Association.

But for now, traders on both sides of the border said the environment was not conducive to doing business.

“Many cotton exporters are not interested in selling cotton to Pakistan. They are trying to find other markets,” said Pradeep Jain, a ginner based in Jalgaon in the western state of Maharashtra.

Shahzad Ali Khan, chairman of Pakistan Cotton Ginners Association, referred to a move by the Indian Motion Picture Producers’ Association (IMPPA), a small filmmakers’ body, last week, banning their members from hiring Pakistani actors.

“India is banning Pakistani artists, so how can it expect us to buy cotton from India?” Khan said.

“In various forums Pakistani traders are saying they will not buy cotton from India this year. Even if they need to pay extra, they will pay and buy it from other suppliers.”

 

Sources :.hindustantimes.com

Soyabean To Remain Under Pressure

Increase in Indian output and global supplies will keep prices under check

With global soyabean output set to increase this fiscal, the pressure on soyabean prices in international markets is likely to continue. As a result, Indian soyabean prices, which have been sticky over the past year, are also likely to come under pressure.

After two years of drought affecting production and lifting prices higher in the domestic market, output from India is set to rise, albeit at a lower-than-projected rate due to floods in the top soyabean-growing State of Madhya Pradesh. Increase in global supplies will offset an otherwise rising demand for soyabean products, leading to accumulation of stocks, thus keeping soyabean prices under check in 2016-17.
Global production set to rise

Soyabean is one of the major oilseed crops in the world, accounting for about 60 per cent of oilseed production in 2015-16. About 86 per cent of the world’s total production is crushed for oil. The oil recovery is 17-18 per cent while the meal forms 80-82 per cent.

The US, Brazil and Argentina are the top three soyabean producing countries in the world, accounting for 83 per cent of the total world production in 2015-16. According to the US Department of Agriculture (USDA), the global production is expected to go up to 333 million tonnes in 2016-17 from 313 million tonnes in 2015-16.

Global ending stocks in 2016-17 are expected to rise which should keep prices under check.

According to the USDA, production in India is expected to go up from seven million tonnes in 2015-16 to 9.7 million tonnes in 2016-17. This is after it revised its estimate down after August.

The USDA reduced its forecast production from 11.4 million tonnes in August to the current 9.7 million tonnes on account of lower area sown and a lower yield forecast. Also, in Madhya Pradesh, excessive rainfall led to widespread flooding, diminishing crop yields, according to the USDA.

Experts in the domestic market too peg a similar estimate. As reported by the Agriculture Ministry on September 8, 2016, the total soyabean area decreased by 1.60 lakh hectares from 116.30 lakh hectares in 2015-16 to 114.70 in 2016-17. The production estimates here are close to 9.5 million tonnes.
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Nonetheless, soyabean output is estimated to be 35-38 per cent higher than that in the previous year.

This will lead to an increase in soyabean crushing in India, to 7.6 million tonnes in 2016-17 from 5.87 million tonnes in 2015-16.
India trade picture

In India, soyabean is mainly used for crushing and thereby obtaining soyameal. Of the total soyabean produced in the country, 70-80 per cent goes for crushing and the remaining is used directly. While import of soyabean is negligible, a chunk of the country’s soya oil demand is met by imports. According to data provided by the Solvent Extractors’ Association (SEA), import of soya oil has nearly quadrupled in the last five years to 4.2 million tonnes in 2015-16.

However, in the past, there has been a good export market for Indian soyameal, particularly from South-East Asian countries, as this is non-genetically modified (GM) soyameal.

But in the last few years, exports have taken a hit due to higher prices of soyameal in the Indian market, compared to other international markets. According to SEA, as of August 2016, FOB/FAS Indian soyameal is quoted at $480 a tonne against Argentina origin soyameal CIF Rotterdam at $383 per tonne. Soyameal exports during April-August 2016 stood at 10,145 tonnes, 71 per cent down from last year.
Price outlook

The price of soyabean as any other commodity is broadly dependent on the demand and supply situation. As mentioned before, an increase in global output this year should keep prices under pressure. The CBOT soyabean did start to trend up in May and June this year on production-related concerns in Argentina. But prices have been down 6.5 per cent in the past two months as the outlook on global production improved.

In the domestic market, prices normally track the international market. The NCDEX soyabean contract (generic) has fallen about 12 per cent over the past two months and 17 per cent so far this year.

From about a peak level of ?4,200 a quintal in April, domestic soybean prices have plummeted to about ?3,051 a quintal. Domestic soyabean prices are also affected by soyameal prices. The bleak export outlook of soyameal can also keep its prices under pressure.

India imports a chunk of its soya oil requirement and hence, domestic prices track international prices. Soya oil price is also linked to the price movements of palm oil (a substitute to soya oil). The government has only recently lowered the import duty on refined palm oil to 15 per cent from 20 per cent. This will also keep the price of soya oil under pressure.

 

Sources ;thehindubusinessline.com