Farmers see oil palm as an alternative to paddy

- They have been facing problems in raising paddy in the rain-fed areas due to water woes
- The area of cultivation under oil palm is all set to increase from 1,000 hectares to 25,000 hectares during the next five years
- Farmers can earn revenue from the fourth year onwards
- While the cost of cultivation per acre is Rs 20,000, they can earn Rs 90,000 to Rs one lakh per acre
- There is massive potential for growth of oil palm industry as the Centre allows 100 per cent FDI in plantation

Nellore: Since farmers have been facing problems in raising paddy in the rain-fed areas in the district, they are now looking for an alternative crop that gives them sustainable income.

The oil palm cultivation is giving hope for them as it gives easy returns even for 25 years with a minimum annual investment for maintenance of the trees.

Now, out of 95 pc edible oils being imported, oil palm stands first with 70 pc of its stake giving assurance for returns without taking any risk.

It was promoted only in an extent of 1,000 hectares earlier, now some companies are planning to increase the area to around 25,000 hectares within next 5 years by creating awareness among farmers.

They say the formulation of National Policy on Biofuels to achieve 20 pc blending target by 2020 has resulted in ample scope for byproducts in sustainable biodiesel production in the country which is likely to increase the industry’s scope in biodiesel applications and subsequent positive impact on overall market growth.

Palm oil market size in India was valued at $ 5.16 billion in 2015. Increasing demand for edible oils owing to the burgeoning population and improving economic conditions are expected to contribute to the growth.

Industry experts say the oil palm industry in the country presents massive potential for growth since the government has allowed 100 pc FDI in plantation and has also promised huge financial aid to farmers in the upcoming years.

“The Indian industry is highly dependent on imports from Southeast Asian nations, particularly Indonesia and Malaysia, which together account for 90 pc of the overall imports. The huge potential for export is assuring the farmers constant revenue returns for next 100 years,” said Ashish Goenka, Director, 3F Oil Palm Agrotech Private Limited.

Consumption in India is also low when compared to the average of the world.

World average has been 22 kg per person and it is only 16 kg in India. Majority consumption is basically by the food and confectionary industry for its products in the country and the domestic consumption has been reduced due to cut throat competition from the branded products that are publicised in the media enormously. Ruchi Soya Industries Ltd., Cofco Agri Ltd., Cargill India, Edible Group, 3F Industries Ltd., Godrej Agrovet, Adani Wilmar Ltd., Troika India, Aditya Engineers, Sundex Process Engineers Pvt. Ltd., Brissun Technology Pvt. Ltd., Tinytech Udyog, Chempro Technovation Pvt. Ltd. and GlamTech Agro Process Pvt.

Limited are key industry
participants and 3F Industries is now concentrating in Andhra Pradesh. Oil palm is being cultivated in West Godavari, Vizianagaram, Visakhapatnam, and Nellore districts. West Godavari stands first with more than 65,000 hectares.

The industry identified around 90,000 hectares of vacant lands in 25 mandals in Nellore district and out of them 25,000 acres would be developed in the coming five years as part of encouraging farmers through creating awareness on National Mission on Oilseeds and Oil Palm (NMOOP) programme of the Union government where the farmers will get huge subsidies on cultivation.

“Paddy farmers have to invest huge amount for cultivation and oil palm farmers who started cultivation get revenue from the fourth year till more than 25 years on a regular basis with an annual maintenance cost of Rs. 20,000 per acre. They will get a minimum of Rs. 90,000- 1 lakh,” said Srinivasa Rao, agri-head of 3F company.

P V Prasad