Soya cultivation rising in crisis-hit Vidarbha

, Nagpur: For 35-year-old Najukrao Wankhede, the Sarpanch of Bhatori village in Akola, it has been a year of mixed fortunes. With cotton crop wrecked by incessant rain in August, he and other farmers of his village opted to cultivate soybean, amidst uncertainty over the prices. By November end, smiles returned on their faces.

"Fortunately for us, soybean prices are very good this season, otherwise we were all in trouble," says Najukrao, who's among hundreds of cotton farmers shifting to soybean and oilseeds for better per-acre returns in suicide-country Vidarbha.

Soybean and other oilseeds are less risky as of now, he says. Plus, they are three-month (early maturing) crops unlike cotton, which remains on fields till March. "If a farmer harnesses rainfall by means of made-to-size farm pond, he can go for second crop. It can bring in better returns at minimum investment for him."

Farm experts say harangued farmers of Vidarbha are inclined to shift to soybean as a cotton substitute, allured by a surging demand for de-oiled cake (DOC) in global markets and soybean edible oil in the domestic market. And with soybean prices remaining robust, the region is in for a major crop shift away from cotton.

This year alone, the area under soybean has increased to over 17-lakh hectare, up from 15-lakh hectare last year in Vidarbha at the cost of cotton acreage that has dipped to 14-lakh hectare, much below its annual average of 17-lakh hectare.

In cotton districts of western Vidarbha, for instance, the cotton area in the 2007-08 kharif shows a decline to 10.7-lakh hectare from 11.5-lakh hectare last year, while that of soybean has jumped to 10.5-lakh hectare from 7-lakh hectare. The trend is similar in Nagpur division as well, where soybean acreage grew from an annual average of 5.16-lakh hectare to 6.43-lakh hectare this year, a rise of 31 per cent.

Holds farmers' leader and founder member of the Shetkari Sanghatna, Vijay Jawandhia: "The cotton farmers' shift to soybean is a reaction to his sagging cotton economy and it coincides with a growing demand for soybean in global markets for a number of factors. One of them is the decline in yields of food crop coupled with production of bio-diesel from food-grain. So the soybean area will increase next year too, but it will also come with risks."

One of the risks is the vulnerability of the crop to little monsoon fluctuation. "It's highly rainfall dependent; so any variation can lead to complete destruction," he says. "Then, the prices are linked to global trends, which are equally volatile."

It'd be better if the government promotes food crops such as jowar, bajra and maize along with traditionally grown oilseeds such safflower, mustard and sunflower, which are sturdy and have high oil contents. "If the government gives incentives to the farmers to grow these crops and makes the support prices very lucrative, they will shift away from cotton and the nation too would benefit."

India is short of both, edible oil and food grain, points out Jawandhia.

Vidarbha can become an edible-oil region

The traditional cotton belt of Vidarbha has a potential of turning into an edible oil producing region, with the battered farmers shifting slowly but steadily on to oilseeds, mainly soybean, annoyed by a sagging and chaotic cotton farming.

The soybean economy now matches cotton economy in Vidarbha, but per-acre returns are better in the former than latter, due to difference in production cost and yields. Also, experts say, Vidarbha missed the processing avenues in cotton in the late-eighties after the new textile policy, but it can make up for that loss in oilseeds sector. Refineries can bring in assured price in a long run, they say.

"Soybean can be a short term substitute, but if the prices are to be stabilized oil processing needs to be promoted," insists Dhananjay Bhuibhar, Congress leader in Akola and a director on the Maharashtra State Central Cooperative Bank.

Bhuibhar is contemplating setting up a soybean solvent extraction plant, but is yet to mobilize investments for it. "I'll try and set up a cooperative," he says.

The value addition from soybean to de-oiled cake and edible oil is over ten-fold besides it holds good employment potential. "A new ancillary industry can come up, if oil refineries or solvent extraction plants are set up here," says Bhuibhar.

Informs Gajendra Bharti, director, Akola District Industrial Centre: "Vidarbha has 25 soybean solvent extraction plants with a crushing capacity of 25,000 tones per day (TPD). So their requirement is good and the region can fulfill it."

Adds Akola collector Dr Shrikar Pardesi: "We've an SEZ for agro-processing in the district and if some one approaches us for oil refinery units, we'll extend all cooperation to the interested parties."

The Vice-president of Soybean Oil Processors Association (SOPA) and owner of Murli Agro Processing Unit here, Nandlal Maloo says the trend will hold next year too, given the increasing domestic demand for soy-oil and global demand for the de-oiled cake (DOC). It'll replace cotton in the next ten years, he claims.

Key though is the price stability, warns Vijay Jawandhia. "The crop prices are linked to highly volatile global markets and unless the government intervenes to stabilize the prices, there's no guarantee that these prices will hold in the future as well."

Oilseeds and other alternative crops for Vidarbha

Experts say early maturing crops such as oilseeds could yield better returns for even marginal farmers in Vidarbha, an assured rainfall but no-irrigation zone.

An early-maturing crop leaves scope for second crop, provided farmers harness water through small need-based farm ponds or collective initiatives like low-cost check-dams (like Vanrai-bunds) on the rivulets and rivers. The model for saving rainwater may vary from block to block, but concerned efforts could yield quick and desired returns by raising the individual farmer's actual farm income level. Then, a second crop (Rabi) is possible on the land, bringing additional income.

Food crops such as jowar, bajra and maize could come back to fields as a main crop (Kharif) if the central government gives incentives and makes support prices lucrative. It could reduce food shortages, and help farmers overcome the biting distress. The central government has set aside Rs.25,000 crore in the 53rd National Development Council (NDC) meeting on agriculture in May 2007. The states have to submit proposals and projects through district-level plans to make use of these funds in addition to the National Food Security Mission.

Jawandhia argues that better price to crops is crucial to boosting rural economy. "If the government wants to give fillip to the rural economy, the only way is to give better prices to crops," he says. "This year, a farmer could earn at least Rs 400 extra per quintal due to a surge in soybean prices, which means on 100 lakh tonnes of soy production in the country this year, farmers earned an extra Rs.4,000 crores. This money went directly into the rural economy without any package," he argues.

Railways may spoil the party

Still other challenges lie ahead. The railways, says the SOPA, has failed to allocate enough rakes to the the soy-units. The department of railway, the association complains, is giving priority to the cement and fertilizer sector. The denial to allocate train rakes for the transport of finished soybean products by the central and South Eastern railways had halted soybean procurement for a few days in the last fortnight of December, giving sleepless nights to the farmers, who had held back their crop anticipating a better price.

"Nearly 50 per cent of the crop is still lying with the farmers and we want to procure it. But we simply could not have procured it had the railways stopped giving us rakes," says Maloo.

Maharashtra is expected to produce 35 lakh tones of soybean, and Vidarbha's contribution to it would be nearly 20 lakh tones, according to the first estimates.

In the last week of December, SOPA issued public interest notices in the newspapers appealing to the government to intervene and resolve the problem. Subsequently, the Indian Railways allocated rakes on alternative days to ease the pressure on the mills.

Maloo says, "Farmers in Vidarbha could earn an extra money on soybean, due to robust prices. But the railways have to assure us of rakes to transport our finished products, otherwise we'll not be able to procure soybean at the same rate in the coming days, because we have no space to stock the produce. Prices will fall and a farmer will suffer in the end."