import of soya oil[1]

MAJOR RESEARCH PROJECT

ON ON

“IMPORT OF SOYABEAN OIL”“IMPORT OF SOYABEAN OIL”

MASTER OF BUSINESS ADMINISTRATION (I.B.)MASTER OF BUSINESS ADMINISTRATION (I.B.)

(2007-2008)(2007-2008)

FACULTY GUIDE: SUBMITTED BY:FACULTY GUIDE: SUBMITTED BY:

PROF. K. K. KINARIWALAPROF. K. K. KINARIWALA RAHUL BAJPAIRAHUL BAJPAI

M.B.A. (IB) IV Sem.

Diligence & Excellence

CERTIFICATECERTIFICATE

This is to certify that Rahul Bajpai of MBA(IB) IV Semester has

undertaken a project on “Import of Soyabean Oil” in lieu of part fulfillment of

Master of Business Administration (International Business) of Devi Ahilya

Vishwavidyalaya, Indore and has submitted this project work.

The work has been carried out to my satisfaction and he has given

exhaustive information regarding the topic. The work has been carried out under

my supervision and guidance. I wish success and good luck in all his endeavors.

____________________

(PROF. K. K. KINARIWALA)

Faculty Guide,

Pioneer Institute of

Professional Studies, Indore

ACKNOWLEDGEMENTACKNOWLEDGEMENT

Exchange of ideas generates energy and will to work in a better way

whenever is helped and co-operated by others his heart is bound to pay his

gratitude and obligations to them. Acknowledgement is not a mere formality but an

expression of deep gratitude and communicates applications.

I take this opportunity to express my gratitude and thanks to all those who

helped me in various ways in the successful completion of this project report.

I am thankful to Mr. P. K. Jain (Director PIPS, Indore) to provide me an

opportunity to do this project report.

I am thankful to my guide Prof. K. K. Kinariwala for his invaluable

guidance.

I am thankful to all the faculty members for their guidance.

RAHUL BAJPAI

MBA(IB) IV Sem.

CONTENTS

Executive Summary

Introduction

o Structure of Soya Industry

o Soyabean Oil

o Problems of Indian Soya Industry

o Import of Soyabean Oil

Review of Literature

Research Methodology

o The Study

o The Design

o The Sample

o Data Analysis

Analysis of Trend

Results

Suggestions

Conclusion

Implications of the Study

Bibliography

EXECUTIVE SUMMARY

This project report aims at identifying and developing the import potential of

soyabean oil. The major focus is on which market Indian edible oil can serve well

and penetrates in that particular market.

Today, edible oil industry produces an array of a number of items, some of

which have received acceptance in the international market. The government of

India through its various schemes is providing number of benefits for the

development of this industry, both in terms of production and marketing. Though,

this industry have achieved considerable strikes in export, it is basically a domestic

market oriented industry.

Soya oil industry is having a very good area in the international trade and is

growing day-by-day as international trade is increasing. So details study is very

essential to draw out the potentialities inherent in it.

The past statistical data and current information about the industry provides

the platform for the soya oil industry to envisage the future trend of the industry.

Chapter 1

INTRODUCTION

STRUCTURE OF SOYA INDUTRY

In India around 52 lacs tons of Soya bean is raised every year, out of which

6 lacs tons go for seed purpose. The balance of 46 lacs tons are crushed to produce

37 lacs tons of Soya extractions and 9 lacs tons of Soya oil. Out of 37 lacs tons of

Soya extraction, demand from bakeries and human grade Soya flour is in the

region of 50,000 tons go for shrimp feeds. Cattle feed consumed around 4 lacs tons

and poultry feed takes 20 lacs tons. The balance of 12 lacs tons are exportable

surplus, which are exported to the neighboring countries.

Soyabean in India – early attempts :

The origin of soyabean’s introduction into India is not known, but it

probably came from China through the Himalayan Mountains centuries ago. Some

believe that it was also brought in via Burnaby traders from Indonesia. As a result,

soyabean has been traditionally grown on a small-scale in Himachal Pradesh, the

Kumaon Hills of Uttar Pradesh (now Uttaranchal), eastern Bengal, the Khasi Hills,

Manipur, the Naga Hills, and parts of central India covering Madhya Pradesh. The

bean is referred to locally as bhat, bhatman, bhatmas, ramkulthi, garakalay, and

kalitur. Because of its high protein and oil content, and other attributes such as its

beneficial effects on soil fertility, several attempts were made in the past to

popularize soybean.

Cultivation in India, including the initiative taken by Mahatma Gandhi

himself in 1935.

The first systematic attempts to develop improved varieties of soybean

suitable for Indian environments were made in the early 1900s at the Pusa

Agricultural Research Farm in Bihar State, and the work was eventually extended

to West Bengal, Orissa, Uttar Pradesh, Delhi, Punjab, MadhyaPradesh,

Maharashtra, Tamil Nadu, and Rajasthan (Woodhouse and Taylor, 1913; 1914;

Lal, 1968).

Several varieties were evaluated at Pusa Farm between 1917 and 1924;

single plants selected and found promising included No. 1 (yellow), No. 2

(chocolate), and No. 3 (black). These were found superior to cowpea (Vigna

unguiculata), guar (Cyamopsis tetragonoloba), and moth bean

(Phaseolusaconitifolia) with respect to grain as well as fodder yields. Research in

Uttar Pradesh was initiated in 1943 at Kanpur with 100 lines from USA and 139

lines from other sources. A number of selections were made. T-1 and T-33 (both

black), T-49 (yellow), and T-2 (brown) were the most promising; T-1and T-49

were recommended for cultivation on the plains; T-33 was recommended for the

hills; andT-2 was recommended for fodder. T-1 and T-49 are still grown in a few

pockets in Uttar Pradesh. Work on soybean improvement in Punjab began in 1947

and about 90 varieties were evaluated. Punjab Soy No. 1 was developed and

recommended for cultivation in the Kangra valley. The Indian Agricultural

Research Institute (IARI) also initiated work on soybean at Delhi in 1947, and

number of varieties from USA was evaluated. Monnetta was found to yield well

for both grain and fodder.

Considerable work was also done on soybean improvement in West Bengal

at Kalimpong and Berhampore, resulting in three improved varieties: Soyamax, K-

30, and Barameli. Soyamax is still cultivated in the Kalimpong area. Soybean

improvement in the central and southern parts of India began in the early 1900s –

almost at the same time as at Pusa Farm – and continued until the late1950s. A

number of lines were evaluated at Jabalpur, Seoni, Indore, and Powerkheda

(MadhyaPradesh), Nagpur and Yavatmal (Maharashtra), and Chennai (Tamil

Nadu), and several selections were made. Some of these were recommended for

general cultivation. A variety called Kalitur is still being grown in Madhya

Pradesh.

Soyabean in India – New attempts and challenges:

To deal with the country’s perennial food shortages, a total of 23 agricultural

universities were established in India during 1960–63 (on the land-grant pattern),

supported by the Government of India and the United States Agency for

International Development (USAID), and selected universities from USA. Also,

several projects to boost food production in the mid-1960s received synergistic

support from agriculture-related industries and the Government, which not only

ensured seed production, farm credit, irrigation water, fertilizers, and pesticides,

but also provided food storage and processing capacity to create a market for the

produce. The country’s agriculture was about to take off, with improvements

already under way for dwarf wheat (Triticum aestivum) and rice (Oryza sativa)

varieties. At the same time, the growing protein shortage in the country due to the

stagnant pulse production also became apparent, and efforts were initiated to take a

fresh look at soybean cultivation in India.

The pioneering work on testing new soybean varieties in India was initiated

by GBPUAT, Pantnagar, and the Jawaharlal Nehru Krishi Vishwa Vidyalaya,

Jabalpur, in collaboration with the University of Illinois, USA. The preliminary

trials conducted at Pantnagar and Jabalpur in 1965–66 using soybean varieties

from southern USA was very encouraging. Some of the varieties, such as Bragg

and Hardee, for example, yielded 3 to 4 t ha-1 within 110–130 days. These yields

were 200% to 300% higher compared with the average yields of 1–1.5 t ha-1 from

other pulses such as Mung bean (Vignaradiata), black gram (Vigna mungo), and

Pigeonpea (Cajanus cajan). This was very encouraging, because the annual

production of pulses and oilseed crops in India had plateau at 11–12 million tons,

and the rapid increase in population was reducing the per-person availability of

protein and oil, resulting in serious malnutrition.

These results prompted the Indian Council of Agricultural Research (ICAR)

to initiate, on 1 April 1967, an all-India project for coordinated research on

soybeans, with the main centers located at Pantnagar, Jabalpur, and Delhi, and

several sub-centers across the country. Substantial funds were committed to the

project by ICAR as well as USAID, which was providing technical assistance to

anumber of agricultural universities in India at that time. Each main center had at

least one breeder, one agronomist, one plant pathologist, one entomologist, one

microbiologist, one food scientist, and one economist. Varietal trials were

conducted at several locations in 1967 and 1968, and based on outstanding

performance; Bragg (a soybean variety from Mississippi, USA) was released in

1968 for general cultivation. Sizable quantities of seed were imported and

multiplied on the farm at Pantnagar University and on large farmers’ fields around

Pantnagar in 1969. The first commercial crop was grown by farmers in 1970 and,

with this, came numerous problems, questions, and challenges.

SOYABEAN OIL

Soyabean Oil is the leading vegetable oil traded in the international markets,

next only to palm. Palm and Soyabean oils together constitute around 68% global

edible oil trade volume, with soyabean oil constituting 22.85%. During the last

decade, volume of soyabean oil exported has grown at the rate of 4.05%. It

accounts for nearly 25% of the World's total oils and fats production. Globally,

production of soyabean oil has grown at the rate of 5.8% during the last decade.

Increasing price competitiveness, and aggressive cultivation and promotion from

the major producing nations have given way to widespread soy oil growth- both in

terms of production as well as consumption. Argentina, Brazil, China and India

along with US are the major contributors for the growth.

While US has a strong domestic consumption base and mostly exports

soyabean in addition to oil, Argentina and Brazil exports much of their production,

mostly in the form of crude oil. China and India, though being producers

themselves, import soyabean/its derivatives to cater to their expanding consumer

base. While China imports both bean and oil, India allows only imports of oil.

Global consumption shot up to 29.38 million tons in 2001-02, growing at the

rate of 5.76% during the past decade. Notable upward movement in consumption

in soyaoil is being seen in EU, Central Europe, Russia, Egypt, Morocco, US,

Mexico, Brazil, China and India.

Soyabeanoil is the derivative of soyabean. On crushing mature beans, 18%

oil and 78-80% meal is obtained. While the oil is mainly used for human

consumption, meal serves as the main source of protein in animal feeds.

India is the World's largest importer of edible oils in the World. Of the total

5.0-5.5 million tons of vegetable oils imported, 1.3-1.5 million tons is soyabean

oil, imported mostly form Argentina, and followed by Brazil and US. In addition to

imports, domestic production of around 0.7-0.8 million tons takes the annual

soyabean oil consumption of the country to 2.0-2.2 million tons, with a market

value of Rs 8000 crore.

Crude and Refined soyabean oils are permitted to be imported into India at

an import duty of 45% and 50.4% respectively. Imports of soyabean oil into India

have been on a continuous rise since the past 6-7 years. It has witnessed a sharp

rise from a mere 84,000 tons during 1996-97 to 1.54 million tons during 2001-02.

Indian edible oil market is highly price sensitive in nature. Hence, the

quantity of soyabean oil imports mainly depends on the price competitiveness of

soyabean oil vis-à-vis its sole competitor, palm oil. This also implies that soyabean

oil prices are highly influenced by palm oil prices in Malaysia, the market leader in

palm oil production and exports.

In India, ready (spot) markets of Indore and Mumbai serve as the 'reference'

market for soyabean oil prices. While the Indore price reflects the domestically

crushed soybean oil (refined and solvent extracted), Mumbai price indicates the

imported soy oil price. Futures trading in soyabean oil is also prevalent in many

futures exchanges in the country, the prices of which are largely influenced by the

international edible price movements (especially Malaysian palm oil and soyabean

oil at CBOT), soyabean availability in domestic markets, demand for meal and

other associated supply-demand factors of soyabean and its derivatives.

Soyabean oil is among the most vibrant commodities in terms of 'price

volatility'. Its prominence in the international edible trade scene (9-10 million

tons), concentration of production base in limited countries as against its

widespread consumption base, its close link with several of its substitutes and its

base raw material (soyabean) in addition to its co-derivative (soya meal), the nature

of the existing supply and value chain, etc throw tremendous opportunity for 'trade'

in this commodity. The opportunity is further enhanced by the expected rise in

consumption base and the consequent increase in imports of vegetable oils in the

years to come.

Futures trading in soyabean oil would essentially serve as the right tool for

hedging market-linked risk by all those in the value chain of the commodity- the

soyabean producing farmers, processors, brokers, speculators, soyabean and meal

traders, traders of other oilseeds and oils, etc.

Soybean oil is a very healthy food ingredient despite the bad publicity

regarding fats and oils in general. Soybean oil does not contain much saturated fat.

Saturated fat causes heart diseases and is mainly found in products from animal

origin. Soybean oil is also used by the food industry in a variety of food products

including salad dressings, sandwich spreads, margarine, bread, mayonnaise, non-

dairy coffee creamers and and snack foods.

Soybean oil contains natural antioxidants which remain in the oil even after

extraction. These antioxidants help to prevent the oxidative rancidity.

About 97 percent of Soyabean oil is used in a wide range of products for human

use, such as:

1. cooking oils

2. salad dressings

3. sandwich spreads

4. margarine

5. salad oils

6. coffee creamer

7. mayonnaise

8. shortenings

9. chocolate coatings

10. a flour ingredient medicines

Soyabean oil also is used in such industrial products as:

1. printing inks

2. cosmetics

3. linoleum

4. vinyl plastics

5. paints

6. caulking

7. compounds

8. pesticides

9. epoxy

10. protective

11. yeast

12. soap

13. shampoos and detergents

14. rubber

SOYABEAN OIL INGREDIENTS

Soya oil has found a home in many commercial food products, from salad

dressing to baked goods. While it beneficial in many ways, it should not be over-

consumed because it still adds fat to your diet. As a plant food, soya is low in

saturated fat (about 15 percent). Of the polyunsaturated fat in soya oil, about half is

linoleic acid, a fatty acid we need in small but significant amounts. In addition,

soya oil contains an important and beneficial fatty acid, linolenic acid, an omega-3

fatty acid found primarily in fish oils. Omega-3 fatty acids are believed to be

helpful in preventing heart disease. Soya oil is about percent linolenic acid, making

it an important source for vegetarians and others who do not consume fish.

Soya oil is found in so many food products that it would be difficult to find

many commercially prepared baked goods that do not contain at least some soya

oil. Margarines and solid shortenings contain soya oil, as do many processed meat

products. This does not mean that the products are any more healthful, however.

When soya oil is used commercially it is usually partially hydrogenated, meaning

that it is no longer polyunsaturated and the percentage of linolenic acid is reduced.

In addition, hydrogenation produces a type of fatty acid that raises cholesterol

levels. It is ironic that with all the health benefits that soyabeans offer, the typical

U.S. diet features large amounts of soya oil, the least nutritionally important

component of this special plant. Of course, this is explained by the fact that the

U.S. is an important producer of soyabeans and soyabean oil is relatively

inexpensive, not to mention versatile. On the positive side, Vitamin E supplements

are also produced from soya oil.

Lecithin is derived from soya oil and you might recognize it as an emulsifier

in foods, that is, it is added to foods to keep them blended. Some people take

granulated lecithin or lecithin capsules in an attempt to lower their cholesterol.

PROBLEMS OF INDIAN SOYA INDUSTRY

Poor capacity utilization around 31% to 35% much below break-even levels.

Stagnant domestic demand- high cost of promotion and publicity.

Unpredictable export market - lack of sustained and dependable demand.

Lack of timely and adequate supply of soyabean of the requisite variety and

quality and short season period of availability.

Pest and quality problem in soyabean, apart from high prices problems in

procuring the raw materials.

Lack of technical guidance in regard to post harvest handling of soyabean

and in minimizing spoilage and other losses.

High prices of packaging material and high cost of other inputs like fuel,

power, transport, etc

Unduly high burden of taxation - sales tax, octroi, custom duty, etc.

High cost of institutional and bank finance.

Heavy undercutting and cutthroat competition of export markets.

Lack of advertising and promotional measures so as to increase the sales.

IMPORT OF SOYABEAN OIL

In past four months, world prices of CSO (Crude Soya Oil) have risen by nearly

51% due to mismatch in global demand-supply. Crude soya oil shot up by 51% to

trade around $1412 per tonne in February 2007. Globally, soyabean prices have

zoomed to 34-year high and soyabean oil to 33-year high in March-April 08. Crude

palm oil in Malaysia zoomed to $929 a tonne (Rs 36,600), while degummed

soyabean oil was quoted at $1,229.50 a tonne in Europe (Rs 48,500). Domestic

soyabean prices have increased to nearly Rs 20,000 and higher oil and meal prices

are helping solvent units to a great extent.

On the other hand, a record soyabean crop has also come to the country’s

rescue. Production in 2008 is estimated at a record 94.6 lt against 79.6 lt last year.

In fact, kharif oilseed production this year is projected at a 168.3 lt, up 34 lt over

last kharif. However, rabi oilseed production could be lower than the normal 100-

105 lt due to fall in rapeseed/mustard area.

Annually, over 10 lakh tonnes (lt) of degummed soyabean oil is imported

with the shipments peaking during 2004-05 oil year (November–October) at 20 lt

before declining to 17 lt in 2005-06 and 13 lt in 2006-07.

Soyabean oil imports into the country have displayed a significant spurt this

year with arrivals increasing by over 100 per cent from 2006-07.

Imports expanded to 18.2 lakh tonnes (lt) during the first 11 months of the

year from November 2004 to September 2005 compared with 7.2 lt during same

period last year.

It is projected to touch a record 20 lt by October 2005, representing 40 per

cent of the country's total imports for 2004-05, up from about 20 per cent, that is

9.0 lt out of total arrival of 44 lt in the previous year.

This phenomenal increase is notwithstanding the fact that soyabean oil is

expensive by as much as $100-120 a tonne than substitutes such as palm oil. Many

believe imports have doubled merely because the rate of customs duty on soyabean

oil is at a relatively low WTO-bound rate of 45 per cent while crude palm oil bears

80 per cent.

In reality, imports have expanded because of the relatively high profitability

of importing soyabean oil. Analysis of landed cost of soybean oil (including import

related expenses and customs duty) and market price (ex-port) shows that import

of this particular oil has been profitable vis-à-vis other oils in the last six months.

Soya oil imports have brought in assured profit of anything between Rs

2,000 and Rs 3,000 a tonne for importers, quick calculations of costs and prices of

last six months show. It is high profitability that has encouraged larger imports. In

addition, huge refining capacities created in the country following tax breaks given

by the Government are also forcing larger imports as refineries have to remain

operational.

One of the negative fallouts of large import of this oil has been the rampant

adulteration of soya oil with sunflower oil, which is a premium product. Because

of low import volumes, sunflower oil is about Rs 10,000 a tonne more expensive

than soyabean oil. This has provided facile opportunity for adulterators to blend

soyaoil with sunoil, and palm off the mix as premium sunoil.

Concerned over shrinking share of the Indian market, palm oil producers

have been seeking a level playing field with soyabean oil in terms of the rate of

customs duty. Given that palm oil is cheaper than soyabean oil by about $100 a

tonne, either a lowering of customs duty on palm oil or a hike in duty on soyabean

oil would provide solid support to palm oil in the Indian market.

Demand for restricting soyabean oil import has already begun to do the

rounds not only in industry circles, but also among government, primarily because

unrestrained imports are seen hurting domestic soyabean and oil market. India is

world's fifth largest producer of soyabean.

Also, not only is the foreign exchange outgo higher on soyaoil import

because of high price, but also revenue generation (customs duty) is lower because

of lower rate of duty.

The Government has not been able to successfully renegotiate a higher

bound rate of customs duty for soyabean oil. Obviously, some non-tariff measure

may be necessary to curtail its imports. Imposing restriction on soyabean oil

produced out of genetically-modified (GM) soyabean could be one way to address

the issue.

Import of Soya Oil during last five years:

Dated: 15/4/2008

Commodity: 15079010 SOYA BEAN OIL OF EDIBLE GRADECountry: U S A

S.No. Year

2002-2003

2003-2004

2004-2005

2005-2006

2006-2007

1. Values in US$ Million 24.56 6.22 8.72 5.22

2. %Growth -74.66 40.06 -40.16

3. Total Import of commodity 74.66 46.76 11.79 8.15

4. %Growth -37.36 -74.80 -30.85

5. %Share of country (1 of 3) 32.89 13.31 73.96 64.00

6. Total Import to country 4,443.58 5,034.83 7,001.35 9,454.74 11,726.96

7. %Growth 13.31 39.06 35.04 24.03

8. %Share of commodity (1 of 6) 0.49 0.09 0.09 0.04

Exchange rate: (1US$ = Rs.) 48.3953 45.9516 44.9315 44.2735 45.2849

Department of CommerceExport Import Data Bank

Import :: Commodity x Country - wise

Dated: 15/4/2008

Commodity: 15079010 SOYA BEAN OIL OF EDIBLE GRADECountry: BRAZIL

S.No. \Year2002-2003

2003-2004

2004-2005

2005-2006

2006-2007

1. Values in US$ Million 10.39 11.80 1.17

2. %Growth 13.52 -90.09 -100.00


4. %Growth -37.36 -74.80 -30.85

5. %Share of country (1 of 3) 13.92 25.23 9.92

6. Total Import to country 316.79 313.52 792.40 893.06 990.91

7. %Growth -1.03 152.74 12.70 10.96

8. %Share of commodity (1 of 6) 3.31 1.49 0.13




Dated: 15/4/2008

Commodity: 15079010 SOYA BEAN OIL OF EDIBLE GRADECountry: ARGENTINA

S.No. \Year2002-2003

2003-2004

2004-2005

2005-2006

2006-2007

1. Values in US$ Million 34.13 27.23 1.15

2. %Growth -20.22 -95.79 -100.00


4. %Growth -37.36 -74.80 -30.85

5. %Share of country (1 of 3) 45.72 58.24 9.72


7. %Growth 29.65 2.98 39.74 16.69

8. %Share of commodity (1 of 6) 6.51 5.05 0.15




Dated: 15/4/2008

Commodity: 15079010 SOYA BEAN OIL OF EDIBLE GRADECountry: BANGLADESH PR

S.No. \Year2002-2003

2003-2004

2004-2005

2005-2006

2006-2007

1. Values in US$ Million 0.04 0.09 0.75 2.93

2. %Growth 120.20 743.96 292.44


4. %Growth -37.36 -74.80 -30.85

5. %Share of country (1 of 3) 0.05 0.19 6.33 35.93


7. %Growth 25.10 -23.52 113.96 79.73

8. %Share of commodity (1 of 6) 0.05 0.15 0.59 1.28



Import :: Commodity-wise all countries

Dated: 15/4/2008

Commodity: 15079010 SOYA BEAN OIL OF EDIBLE GRADE Unit: KGS

S.No. Country Values in Rs. Lacs Quntity in thousands

2006-2007 2007-

2008(Apr-Jun)

%Growth 2006-2007 2007-

2008(Apr-Jun)

%Growth

1. BANGLADESH PR 1,326.08 205.32 4,408.13 758.00

2. NEPAL 2.50 7.79

3. U S A 2,362.16 152.99 4,752.83 333.73

Total 3,690.74 358.31

Source : www.commerce.nic.in

Chapter 2

REVIEW OF

LITERATURE

REVIEW OF LITERATURE

Soya oil imports down to a trickle

M.R. Subramani Chennai, Dec. 27

Import of soyabean oil (degummed) has declined to a trickle, thanks to

disparity in its prices in comparison with crude palm oil and a record domestic

soyabean crop. While not a single tonne of soyabean oil was imported in

November, a negligible amount has landed this month.

“Soyabean oil could have been imported in one or two parcels this month.

This is because its landed cost is $150 a tonne higher than that of crude palm oil,”

said Mr B.V. Mehta, Executive Director of the Solvent Extractors Association of

India (SEA). According to SEA, the landed cost of degummed soyabean oil is

$1,125 (Rs 44,300) a tonne, while that of crude palm oil is $965 (Rs 38,000).

Edible oil imports jump 40%

Dhimant BhattPosted online: Monday , March 17, 2008 at 2351 hrs IST

Mumbai, Mar 17 Despite the sharp price rise in crude palm oil (CPO) and

crude soya oil (CSO) globally in the past four months, flow of edible oils imports

into the country has not been impacted during the current season 2007-08 thanks to

demand-supply gap.

Total imports of edible oils mainly crude palm oil, soya oil degummed, RBD

palmolein and crude sunflower oil have registered a sharp increase of 40% and

recorded at 15.12 lakh tonne over first four months of the current season 2007-08

(November/February) as against 10.83 lakh tonne in the same period last season,

according to the Solvent Extractors' Association of India (SEA).

Chapter 3

RESEARCH

METHODOLOGY

RESEARCH METHODOLOGY

Research is common parlance refers to search for knowledge. One can also

define research as a scientific and systematic search for pertinent information on a

specific topic. Redman and Mary define research as a “systemized effort to gain

new knowledge”.

According to Clifford Woody research comprises defining and redefining

problems for formulating hypothesis. Research is thus an original contribution to

existing stock of knowledge for its advancement when we talk of research

methodology we not only talk about research method but also consider the logic

behind the research method we have used in the context of our research.

Time series analysis is used to detect patterns of change in statistical

information over regular intervals of time we project these patterns to arrive at an

estimate for the future. Thus time series analysis helps us cope with uncertainties

about the future.

OBJECTIVE OF THE STUDY:

To study soya production in India.

The study of current and future trends of import of soyabean oil.

To identify the factors affecting the import of soya oil.

To find out the countries who dominate the import of soya oil.

TOOLS FOR DATA COLLECTION: -

Data will be collected with the help of secondary sources. Such as national

import-export reports available in the library, Journals, Magazines,

Newspapers, and Internet.

STATISTICAL TOOLS FOR DATA ANALYSIS: -

The collected data will be analyzed with trend analysis. Trend analysis will

be done in this equation like (co-relation)

Y = a + bX

Y = Trend value

a = constant factor

b = variable factor

X = number of years

Chapter 4

DATA INTERPRETATION

AND FINDINGS

TREND ANALYSIS

TOTAL IMPORT OF SOYA OIL TO INDIA (US $ Million)

Year Value Trend Value

2003-04 74.66 70.51

2004-05 46.76 47.06

2005-06 11.79 23.61

2006-07 8.15 0.16

2007-08 . -23.29

2008-09 . -46.74

2009-10 . -70.19

2010-11 . -93.64

2011-12 . -117.09

IMPORT OF SOYA OIL FROM USA TO INDIA (US $ Million)


2003-04 24.56 19.51

2004-05 6.22 13.96

2005-06 8.72 8.40

2006-07 5.22 2.85

2007-08 . -2.70

2008-09 . -8.25

2009-10 . -13.80

2010-11 . -19.36

2011-12 . -24.91

IMPORT OF SOYA OIL FROM BRAZIL TO INDIA (US $ Million)


2003-04 10.39 12.11

2004-05 11.80 7.93

2005-06 1.17 3.75

2006-07 0.00 -.43

2007-08 . -4.61

2008-09 . -8.79

2009-10 . -12.97

2010-11 . -17.15

2011-12 . -21.33

IMPORT OF SOYA OIL FROM ARGENTINA TO INDIA (US $ Million)


2003-04 34.13 34.90

2004-05 27.23 22.05

2005-06 1.15 9.20

2006-07 0.00 - 3.64

2007-08 . -16.49

2008-09 . -29.34

2009-10 . -42.18

2010-11 . -55.03

2011-12 . -67.88

IMPORT OF SOYA OIL FROM BANGLADESH TO INDIA (US $ Million)


2003-04 0.04 -0.45

2004-05 0.09 0.49

2005-06 0.75 1.42

2006-07 2.93 2.35

2007-08 . 3.29

2008-09 . 4.22

2009-10 . 5.15

2010-11 . 6.08

2011-12 . 7.02

DATA INTERPRETATION & FINDINGS

India produce about 5 million tons of bean with an average yield of 1 ton /

has 5% of the total soya bean production generally used for and feed, 10% for seed

and 85% for oil extraction. Oil yield is about 17.65% and that of soya meal is

82.35%. about 85% of the total soya meal produced in India is exported and the

balance 15% is used domestically in food and feeds. Through the country gets

foreign exchanged equivalent of Rs. 20000 million annually, the people of the

country are deprived of the precious dietary protein source for which there is a

shortage.

The major problems in food uses of the present soya meal are residual

hexane, protein quality and the microbial load. However, this could be checked and

edible grade soya meal can be produced from the existing Soyabean solvent

extraction plants.

The typical composition of soya meal is 44% proteins 5% oil 7% fiber and

12% moisture. The fiber and protein contents are dehulled and solvent extracted

soya meal may not be more than 3% and less than 48% respectively.

Total Import of Soya Oil:

In 2003-04 India imported soyabean oil worth 74.66 US $ Million, in 2004-

05 worth 46.76 US $ Million, in 2005-06 worth 11.79 US $ Million and in 2006-07

worth 8.15. So due to sufficient soya production at home total import is

continuously decreasing. According to trend analysis in future total import of

soyabean oil will decrease.

Import of Soya Oil from USA :



worth 5.22. So the import of soya oil from USA is decreasing year by year.

According to trend analysis in future import will decrease.

Import of Soya Oil from Brazil :



there is no import of soya oil from Brazil. So the import of soya oil from Brazil is

decreasing year by year. According to trend analysis in future import will more

decrease.

Import of Soya Oil from Argentina :



there is no import of soya oil from Argentia. So the import of soya oil from

Argentina is decreasing year by year. Negative trend in trend analysis also display

decrease in import in future.

Import of Soya Oil from Bangladesh :



worth 2.93 from Bangladesh. So the import of soya oil is incresing year by year.

Positive trend in trend analysis also display increase in import in future. Although

India doesn’t import much from Bangladesh but this is only country which shows

positive trend of import.

Chapter 5

CONCLUSION

CONCLUSION

If we see the objectives of the study it basically aims at identifying the

import of soya oil and study the factors affecting the import. So by analysis it can

be said that India imports soya oil from USA, Brazil, Argentina & Bangladesh

only. Argentina is the major importer of soya oil. Since India produce soyabean in

sufficient quantity for domestic use. So there is not much requirement of import.

That’s the reason after 2003-04 import is continuously decreasing year by year

from USA, Brazil & Urgentina. Import of soya oil from Bangladesh is increasing

since after 2003-04. But it’s very less as compare to Argentina, USA & Brazil.

In 2008-09 due to price rise in soya oil Govt. is planning to reduce custom

duty to attract importers like Brazil & USA. The data collected shows that till 2006

each country has same trends and have less prospects in the near future. If custom

duty is decreased there may be seen more import of soya oil from major importers

like Brazil, USA & Argentina.

SUGGESTIONS

Soyabean processing industry should be treated as a high priority industry and

providing it with all vital inputs including finance as affordable prices,

subsidized to the extent necessary and insulated from scarcities and

interruptions in supplies.

Import duty on the import of modem plant and machinery should be reduced so

that with the help of modem technology a quality product can be produced and

its cost of production will also be reduced so as to become competitive in world

market.

Industrial licensing and registration policies to be regulated so as torn prevent

sickness at all the sectors of industry.

Government should provide a wide range of varieties having the desired quality

attributes, in required quantities over extended periods at economic prices.

The government should also set up large industrial states exclusively for edible

oil meal manufacturing units and encourage even existing unit to gradually

move to such industrial estates by offering suitable inducement.

Infrastructural facilities needed for post harvest handling, storage and

transportation should be provided at the costs the industry can bear.

Research and development in the field of developing soyabean varieties should

be encouraged so as to get higher yield with quality product.

Product promotion and marketing of the process products to be undertaken in

the domestic markets and on massive scale, full financial support to be provided

by the government.

The incidence of all kind of taxes, duties, and other Levis imposed by the

central state and local government should be minimized or reduced to levels,

which the industry can bear.

Chapter 6

Implications

of

the Study

For Government:

The research may be useful for Government to review its export policy so

that procedural hassles can be minimized to enable exporters to apply

their entire mind, time and energy on business.

For Exporters:

The research may be useful for exporters to increase there business

volume.

They can take decisions as per the statistical analysis. Exporters can work

together with government departments for achieving the common goal of

earning precious foreign exchange for the country.

For Researchers

The study gives indications of the export potential of the edible oil

industry and gives an idea about what are the factors affecting export of

edible oil. So there is a scope for finding the reasons for such behavior

due to factors.

Study opens several avenues for further study in terms of;

Export policy

Exporters role

Product quality

BIBLIOGRAPHY

John W. Alexander ‘Economic Geography’ (Third edition). Ashok K.

Ghosh: New Delhi

www.sopa.org

www.soyatect.com

www.financialexport.com

www.apo-tokyo.org

http://www.sopa.org/

import of soya oil[1]

Documents