Pulses, oil seeds, fruit output to lag demand till at least 2030-31: report

Food deficits in India to persist/widen over next 7yrs; demand for non-cereals/high-valued commodities to exceed population growth rate. Report calls for policy attention to ensure balance between domestic production & absorption, diversification towards high-value commodities to reduce food wastage.

Price spikes in pulses this year may have been spurred by dented production prospects amid an uneven monsoon, but India’s output shortfalls vis-a-vis demand for the key protein source as well as edible oils and fruits are expected to persist or even widen over the next seven years, as per a new research report by agricultural economists.

Food deficits compel reliance on imports and raise the food import bill in the long run, cautioned the research report on ‘Prospects of India’s Demand and Supply for Agricultural Commodities towards 2030’, published by the National Bank for Agriculture and Rural Development (NABARD) and the Indian Council for Research on International Economic Relations (ICRIER).

“Commodities like oilseed, pulses and fruits are expected to experience a supply and demand gap in the coming years. Therefore, there is a need to increase the level of production and productivity of oilseeds, pulses, and fruits since their demand in the future shows an increasing trend,” the report’s authors Ashok Gulati and Shyma Jose said.

As per capita incomes rise, the consumption basket of people tends to diversify towards nutritious and high-valued commodities, including fruits and vegetables and dairy products and away from staples such as rice and cereals, the report noted. So demand growth for non-cereals and high-valued commodities is expected to exceed the population growth rate and cereal commodities’ growth in coming years, they argued.

The report assumes significance as recurrent high food inflation spells, like the ones seen this year, cramp the room for monetary and fiscal policies to promote economic growth.

Output of pulses, some coarse cereals and groundnut oil seeds could hit a three-year low this Kharif season, as per initial independent estimates for crop output. Retail inflation in pulses accelerated sharply to 18.8% last month, while inflation in fruits picked up to hit 9.34%. Edible oils have witnessed deflation through most of this year, as their prices had surged sharply last year after the Ukraine conflict erupted.

Oil seeds production is expected to rise to around 35 to 40 million tonnes (MT) by 2030-31, with the gap between demand and supply likely to expand to 3 MT by 2025-26 and 6 MT by 2030-31, even if per capita incomes rise just 5.1%.