India

Market Snapshot 2018 - India - Commodity Table

Supply/Demand Basics

  • World’s fifth largest feed producer (after China, U.S., Brazil, Mexico).
  • World’s largest dairy herd.
  • Big swings in monsoon weather create production risk and stifle investment.
  • Two main growing seasons – kharif and rabi – with kharif seeing 66% of the production.
  • Large and sophisticated starch sector that caters to India’s textile industry.

Country Overview

  • Population / growth: 2 billion / 1.3%
  • Urban / growth: 5% / 2.5%
  • GDP / growth: $9.447 trillion / 6.7%
  • GDP per capita (PPP): $7,200
  • Predicted to be the most populous country by 2022.
  • Average age women at age of first childbirth is under 20 years old.
  • 47% of the country’s population is under 24 years old.
  • Current budget is focused on infrastructure projects.

Trade and Market Share Issues

  • Industrial corn/starch industry expected to grow by 5% to almost 2.8 MMT.
  • Potable alcohol industry consumes around 1.25 MMT of corn and rising.
  • A rising and major importer of U.S. industrial grade ethanol.
  • World’s worst air quality is creating momentum for more fuel ethanol blending.
  • National corn yield exceptionally low at 2.5 mt/ha.
  • Ease of doing business is low due to India’s notorious bureaucracy, but it is improving.

Policy Issues

  • Bt cotton is widely accepted and adopted.
  • Corn import TRQ allocations (500,000 MT) are slow and ineffective, 50% out of quota duty.
  • No effective mechanism to approve transgenic varieties (GEAC).
  • Minimum support price (MSP) policy for corn.
  • Illegal to blend domestically produced grain alcohol into fuel.

Market Snapshot 2018 - India - Chart