RAPESEEDS AND RAPESEED OIL

Presented by Avi Jain (222) Prerana Sharma (243) Rachita Masand (245) Satish Singh (256) Saurabh Bhattacharya (257) Shivaji Saha (260) Swati Bhatter (271)

Rapeseed (Brassica napus) Its a bright yellow flowering member of the family Brassicaceae (mustard or cabbage family). Canola is a trademark for a hybrid variety of rape initially bred in Canada Canola being an short form for Canadian Oil, Low Acid Major difference among Mustard seeds and Rapeseed is in the pungency levels. Rapeseed is more pungent

Varieties of Rapeseed

WORLD PRODUCTION OF RAPESEEDS
Approx production is 60 million tonnes contributing 12-13% of the total world oilseeds production. Rapeseeds yields 37 per cent oil and the rest is high protein oilcake.

India 16% 9.6 mn T China 34% 20.4 mn T

Canada 18% 10.8 mn T

European Union 32% 19.2 mn T

WORLD CONSUMPTION OF RAPESEEDS

India 15%

Canada 11%

European Union 27 45%

China 29%

CONSUMPTION PATTERN IN INDIA
AREA South and West India East and North India Several Pockets in South Northern Plains PREFERRED OIL Groundnut oil is preferred Rapeseed/Mustard oil Sesame and Coconut Oil preferred Vanaspati Oil

Rapeseed Oil- major demand from eastern and northern areas of the country
‡ The arrival of this crop in the markets is in its peak period during March to May. ‡ The major centers of consumption of its oil are Kolkata, Bihar, Jharkhand and the northeastern areas like Assam, Tripura, Sikkim etc.

FACTORS INFLUENCING PRICES
1) National and International market variations 2) Government raw oils import policies 3) Prices of other oils used in mixture 4) Interstate ban on supply of raw oils 5) Pricing strategy adopted by the competitors 6) The pricing structure which represents the margin to the distributors, retailers

India¶s Position in the World Production, Export, Import
( all figures in Thousand Metric Tonnes)

PRODUCTION WITH RESPECT TO TOP PRODUCERS OF THE WORLD
PRODUCTION (TMT)
China, India Canada Japan EU-27 Other Grand Total Foreign Agricultural Service/USDA Office of Global Analysis (Oct-Sep) (Oct-Sep) (Aug-Jul) (Oct-Sep) (Jul-Jun) 2006-07 4,067 2,135 1,440 890 6,520 2,027 17,079 2007-08 3,870 1,968 1,675 902 7,575 2,249 18,239 2008-09 4,225 1,990 1,830 945 8,140 2,660 19,790

IMPORT POSITION
IMPORTS
China, India Canada Japan EU-27 Other grand total (Oct-Sep) (Oct-Sep) (Aug-Jul) (Oct-Sep) (Jul-Jun) 2006/07 330 0 136 18 727 989 2,200 2007/08 277 0 36 17 296 1,321 1,947 2008/09 330 0 40 20 210 1,468 2,068

Foreign Agricultural Service/USDA Office of Global Analysis

EXPORTS
EXPORTS
China, India Canada Japan EU-27 Other grand total (Oct-Sep) (Oct-Sep) (Aug-Jul) (Oct-Sep) (Jul-Jun) 2006/07 54 2 1,265 0 51 571 1,943 2007/08 8 1 1,285 0 132 475 1,901 2008/09 10 1 1,450 0 150 577 2,188

Foreign Agricultural Service/USDA Office of Global Analysis

DOMESTIC CONSUMPTION
DOMESTIC CONSUMPTION
China, India Canada Japan EU-27 Other grand total (Oct-Sep) (Oct-Sep) (Aug-Jul) (Oct-Sep) (Jul-Jun) 2006/07 4,343 2,133 353 918 7,198 2,555 17,500 2007/08 4,139 1,967 380 926 7,774 3,096 18,282 2008/09 4,545 1,989 410 945 8,172 3,546 19,607

Foreign Agricultural Service/USDA Office of Global Analysis

INDIA OVERALL POSITION
INDIA S POSITION
Imports exports Domestic Consumption Ending Stocks (Oct-Sep) (Oct-Sep) (Oct-Sep) (Oct-Sep) 2006/07 0 2 2,133 0 2007/08 2008/09 0 1 1,967 0 0 1 1,989 0

Foreign Agricultural Service/USDA Office of Global Analysis

World Market Price Trends

Source:www.indexmundi.com

Yield/hectare ‡ First position in terms of area covered for production of rapeseed. ‡ Rape seed production and Yield in 09-10 stands at 1000 kg/hectare

Source: NMCE report

Production and Extraction

1 2

Traditional extraction methodmethod- ghani Processing rapeseed in an expeller

Specifications European Rapeseed Oil Symbol EHC Rapeseed. Oil, crude, degummed with European produced origin of good merchantable quality, guaranteed unbleached, produced from rapeseed with loyal and merchantable quality, all duties paid ans meeting the following specifications : - free fat acid (f.f.a.) as oleic acid, calculated on a molecular weight of 282 : maximum 1,75 % - Moisture, volatile matter and impurities : maximum 0,4 % - Lecithin (expressed as phosphorus) : maximum 300mg/kg - Erucic acid : maximum 2 % - Flash point minimum : minimum 250°F (121°C) 50 metric tons EUR per metric ton 0.25 per metric ton, i.e. EURO 12.5 per contract

Underlying Instrument

Trading Unit Price Quotation Minimum Price Fluctuation (tick) Contract Cycles Regular Initial Margin

August (Q), November (X), February (G) and May (K) EUR 1 500

Spread Margin

EUR 750

Last Trading Day First Trading Day

The 25th of the month preceding the delivery month. If it is a non-working day, the first trading day prior to this day

First trading day following the closing of a delivery month

Settlement

Physical delivery of the good at contract maturity, during the entire month of delivery, in ex-tank position, delivery places located in the Netherlands only.

Daily Price Limit

EUR 25

Trading Hours

Pre-opening : 10:30 am - 10.45 am Trading session : 10.45 am - 1:00 pm Pre-opening : 2:45 pm - 3:00 pm Trading session : 3:00 pm - 6.30 pm ( all Paris Time )

MAJOR EXPORTERS RS OIL (8.6 mn) Canada (69%) Ukraine (14%) Australia (3%) Russia ( 2%)

MAJOR IMPORTERS RS OIL (8.5 mn) Mexico (15%) China (13%) EU-27 (16%) Japan (27%)

Source USDA 2009

Climatic conditions Lower yields in India have more to do with climate and soil conditions than crop management. The growth of rapeseed-mustard is more vigorous in temperatures between 10Û and 30Û C. Crop is very sensitive to high temperature at the blooming time. Seed oil content, however, is highest when seed mature under low temperatures 10Û to 15ÛC. Crop needs three weeks of near-freezing temperatures in the field to get fully vandalised and start rapid generative growth.

Production(%) of Rape/Mustard in India
OTHERS PUNJAB BIHAR ASSAM WEST BENGAL GUJARAT MADHYA PRADESH HARYANA UP RAJASTHAN

2 1 1 1 5 6 10 10 11 53 0 10 20 30 40 50 60

SOURCE MCX REPORT

STATE

MAJOR TRADING CENTRES

RAJASTHAN

ALWAR, BHARATPUR, KOTA, JAIPUR, GANGANAGAR & BIKANER DELHI HAPUR & KANPUR KOLKATA & BURDWAN MUMBAI INDORE

DELHI UTTAR PRADESH WEST BENGAL MAHARASHTRA MADHYA PRADESH

Major Trading Centres Delhi and Hapur are the major market for Rapeseed Oil in India and the prices of these markets serve as 'reference' for other subsidiary markets.

Supply Dynamics
‡ ‡ ‡ ‡ ‡ ‡ Market Influencing Factors Prices and demand-supply pattern of other edible oils in the country and abroad Monsoon in the country Pests and diseases and other environmental factors Speculation and Hoarding Consumption of the by-products (animal feed, lubricants, vegetable oil for human consumption, and biodiesel) Production fluctuations

Major trading centres of Rapeseed/Rapeseed Oil Trading in the World
‡ ‡ ‡ ‡ Canada Winnipeg commodity exchange France (Paris Futures Exchange) China (Zhengzhou Commodities Exchange) Australia , United Kingdom, Netherlands

Rates of Rapeseed Oil for 1 Year
Oct/10 Sep/10 Aug/10 Jul/10 Jun/10 May/10 Apr/10 Mar/10 Feb/10 Jan/10 Dec/09 Nov/09

1,149.37 1,034.97 1,015.07 956.07 892.84 864.37 914.95 912.01 896.55 929.11 920.23 923.98 0 200 400 600 800 1000 1200 1400

US $ PER METRIC TONNES

Recommendations
‡ Productivity gains in the rapeseed/mustard oil sector ‡ Development of an organized market for rapeseed/mustard oil ‡ Transparency in the regulated mandis. ‡ Technological improvements (Euric Acid) ‡ Prevention of adulteration. ‡ Exploring export opportunities in the market ‡ Supply side management

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