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Key takeaways

  • Palm oil production in India is expected to reach 1.2 to 1.5 million tons by 2030-31.
  • Government incentives introduced in 2021 have encouraged farmers to increase the area under oil palm cultivation, which is expected to increase further this year.
  • Godrej Agrovet expects its own palm oil production to double to 250,000 tons by 2030-31.

Palm oil production in India is expected to increase significantly in the coming years, with experts predicting a tripling by 2030-31. This reports Reuters. This projected growth is due to the fact that India's palm oil plantations will triple by 2030-31. This is due to expansion of acreage (cultivated area of agricultural land for production) for oil palm cultivation and maturation of existing plantations. Sougata Niyogi, CEO of Godrej Agrovet Ltd.'s oil palm plantation division, highlighted this trend by stating that production is expected to reach 1.2 to 1.5 million tons within 5 to 6 years, a significant jump from the current 400,000 tons.

Government incentives encourage expansion

This expansion is largely attributed to government incentives introduced in 2021 to make India less dependent on vegetable oil imports. These incentives have encouraged farmers to increase oil palm acreage, which increased to 375,000 hectares last year and is expected to increase further by 80,000 to 100,000 hectares this year.

Continued expansion

Oil palm trees typically begin producing fruit 3-4 years after planting, with yields increasing significantly around the sixth year. The combination of these maturing plantations and continued expansion will provide a significant increase in production. India currently imports about 16 million tons of vegetable oils annually. Of these, 9 to 10 million tons involve palm oil, mainly from Indonesia, Malaysia and Thailand.

Godrej Agrovet's projection

Godrej Agrovet expects its own palm oil production to double to 250,000 tons by 2030-31. The company noted a recent improvement in the availability of shoots, essential for seedling production, which further contributes to accelerating production. This projected increase in domestic palm oil production has the potential to significantly reduce India's reliance on imports and lower its significant vegetable oil import bill.

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