Pulses, oil seeds, fruit output to lag demand till at least 2030-31: report

Subject : Geography

Section: Economic geography

Context:

India’s output shortfalls vis-a-vis demand for the key protein source (pulses), as well as edible oils and fruits, are expected to persist or even widen over the next seven years, as per a new research report by agricultural economists.

Details of the report:

Report title: ‘Prospects of India’s Demand and Supply for Agricultural Commodities towards 2030’
Published by: National Bank for Agriculture and Rural Development (NABARD) and the Indian Council for Research on International Economic Relations (ICRIER).
The report reiterated the recommendation of a 2012 report from the Commission for Agricultural Costs and Prices (CACP) to raise the import duty whenever the import price of crude palm oil falls below $800 per tonne to protect Indian producers. However, it also added that attaining self-reliance in water-intensive and long gestation crops like oil palm may not be worth pursuing as a sustainable goal either.

Key Findings:

The food deficit will lead to high import bills in the long run.
Commodities like oilseed, pulses and fruits are expected to experience a supply and demand gap in the coming years.
Therefore, there is a need to increase the level of production and productivity of oilseeds, pulses, and fruits since their demand in the future shows an increasing trend.
Reason for rising demands:
- As per capita incomes rise, the consumption basket of people tends to diversify towards nutritious and high-valued commodities, including fruits and vegetables and dairy products and away from staples such as rice and cereals.
- So demand growth for non-cereals and high-valued commodities is expected to exceed the population growth rate and cereal commodities’ growth in coming years.
Oil seeds production is expected to rise to around 35 to 40 million tonnes (MT) by 2030-31, with the gap between demand and supply likely to expand to 3 MT by 2025-26 and 6 MT by 2030-31, even if per capita incomes rise just 5.1%.

Report recommendations:

There is a need for policy attention to ensure a balance between domestic production and the absorption of these commodities, diversification towards high-value commodities that require major investments in market infrastructure, processing, and cold storage and warehousing facilities to build an efficient and reliable value chain.
Such measures can significantly reduce food wastage.