9/27/2004 BUSINESS LINE- Mumbai, Sept. 25 - GLOBAL production of 10leading oilseeds, estimated at 365.35 million tonnes (mt) during 2004-05,is expected to result in ample oilseed supplies worldwide but there areconcerns about the drought in Argentina and Brazil, according to Mr ThomasMielke, Editor, Oil World.

"If rains do arrive by October, a big supply problem could emerge," MrMielke said.

In the global oilseeds production scenario, there are uncertaintiessurrounding Argentina and Brazil. "But there are also quite considerableuncertainties regarding oilseed yields and production in India, China andCanada," Mr Mielke said.

Global oilseed stocks during 2003-2004 were considerably lower because ofa fall in production and strong demand. This lead to unusually highoilseed prices during January-June 2004. This in turn pushed up the areaunder oilseed cultivation higher by 5.7 million hectares.

"We estimate the world harvested area to be up by around 3 millionhectares for soyabeans, by 2.5 million hectares for cottonseed, by 0.2million hectares for groundnut, by 0.8 million hectares for rapeseed andcanola and by 0.5 million hectares for palmkernals," Oil World said in itsSeptember 23, 2004 issue.

However, as demand is on an upward curve, crushings of oilseeds will rise,according to Mr Mielke. Crushings of 10 oilseeds will increase by 16.4 mtto 302 mt during the 2004-2005 season. "The boost in crushings will benecessary mainly to satisfy accelerating demand and also to replenish thetight stocks of soya oil and other oils and fats," he said.

World oil production during 2004-2005 is also seen higher at 33.07 mt ascompared to 30.97 mt in the earlier season.

Similarly, global oil meal output is forecast to reach 233.5 mt in2004-2005, up sharply by 12.6 mt from the earlier year.

India's production of oilseeds is expected to be lower at 111.20 lakhtonnes for the 2004-05 season compared with 125.20 lakh tonnes primarilybecause sowing was impacted due to delay in rains.

"The dry weather in July and insufficient rains in September has taken atoll on the yields of oilseeds crop," said Mr Govindbhai Patel, PastPresident, Solvent Extractors' Association. In India, the area underkharif production has increased by 17 lakh hectares, mainly soyabean.

The groundnut crop is estimated to decline significantly to 37 lakh tonnesagainst the previous season's 50.5 lakh tonnes. The decline, according toMr Patel, is on account of moisture stress in July and insufficient rainin the beginning of September.

Soyabean production is estimated between 64-68 lakh tonnes. Rains duringthe last week have helped improve yields, industry representatives atGloboil India said.

While Madhya Pradesh's crop may witness a minor decline over the previousseason, Maharashtra's output is seen up at 19 lakh tonnes from last year's18 lakh tonnes.