Scenario of Castor Seed Castor (Ricinus communis L.) is a non edible oilseed, belonging to the Euphorbiaceae family. India is the leader in global castor production and dominates in international castor oil trade. The Indian variety of castor has an oil content of 48%. Out of 48% about 42% of oil is being extracted and the cake retains the rest. The Castor seed products have widespread application in many industries like Paint, Lubricant, Pharmaceutical, Textiles, etc. Seasonality Castor is a perennial crop but grown as an annual for economic purpose. Castor grows well in tropical conditions. It grows best in heat and humidity. The crop duration is 4-5 months. In India, it is sown in July/August and harvesting commences around January/February. The arrivals in the market start from January onwards till mid of May. Gujarat Andhra Pradesh Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Sowing Growth stage Harvesting Processing of castor seed Castor seed harvested from field is dried till the pods open. Seeds are hulled by using de-hullers or by hand to remove the seed from the pod. Seed contains about 50 percent of oil by weight. Extraction of oil from castor seeds is done in a manner similar to that for most other oil seeds. The ripe seeds are allowed to dry, when they split open and discharge the seeds. These seeds are cleaned, cooked and dried prior to extraction. Cooking is done to coagulate protein (necessary to permit efficient extraction), and to free the oil for efficient pressing.
The first stage of oil extraction is pre-pressing, using a high pressure continuous screw press called the expeller. Extracted oil is filtered, and the material removed from the oil is fed back into the stream along with fresh material. Material finally discharged from the press, called cake, contains 8 to 10 percent oil. It is crushed into a coarse meal, and subjected to solvent extraction with hexane or heptane. Process flow chart Cook with steam and mechanically expel Degumming & Decanting Castor seed First pressed castor oil First pressed degummed (FPD) Castor oil - FPD Castor oil commercial grade Uses Castor oil and its derivatives are extensively used in the manufacture of Surfactants Specialty soaps Coatings Lubricants Plastizers Paper inks
Global Scenario Global castor seed production is almost stagnant around 10-14 lakh tonnes in the past 7-8 years. Output touched all time high of 15 lakh tonnes during 2005 as production has significantly increased in India. Yield has drastically declined during 2006 and reflected in total output. India is largest producer of castor seed and constitutes about 64% of total global production. Any changes in area and yield in India has major impact on global castor output. 16 14 12 World Area, Production and Yield of Castor seed 1050 1000 Area & Production 10 8 6 4 2 0 850 800 2001 2002 2003 2004 2005 2006 Area(Lakh Ha) Production(Lakh Tonnes) Yield 950 900 Yield Percentage share of Castor seed production Brazil 8% Others 7% China 21% India 64%
Global castor oil consumption Although India produces major percentage of castor oil, its domestic consumption is limited. China is the major consumer of castor oil, which consumes about one third of total production. Other major consumers are Europe, India and Brazil. Castor see d oil consumption Japan 4% Others 8% India 15% USA 7% EU 24% China 32% Brazil 10% Indian Scenario Castor seed production has gradually increased in the past few years. India recorded highest output of nearly 10 lakh tonnes during 2005 with increased yields. Area is almost stagnant in the past few years, however, increased yields of castor seed contributed to higher output. Castor seed has recorded highest yield of 1216 kg per hectare in previous year. The sufficient rainfall and irrigation sources especially in Gujarat have improved the yield in India.
12 10 India Area and Production of Castor seed 1300 1200 Area & Production 8 6 4 2 0 1100 1000 800 700 600 2001 2002 2003 2004 2005 2006 2007 Area(Lakh Ha) Production(Lakh tonnes) Yield(Kg/Ha) 900 Yield Castor seed production in India Other States AP 4% 9% Rajasthan 16% Gujarat 71% Cultivation of castor seed mainly confined to western states like Gujarat and Rajasthan both together contributes 87% to total production. Gujarat has the largest share in India production with 71% followed by Rajasthan (16%). Apart from these two states, it is also grown in southern state of Andhra Pradesh, which accounts for 9% of the total production. Export of castor seed oil by India India is largest exporter of castor seed oil as it is largest producer of the seed. Annually it exports about 1.8-2.0 lakh tonnes of castor seed oil and receives huge foreign earnings. Export volumes have
marginally declined in the past three years even as output has increased during same period. Appreciating Rupee has affected the export quantities, however, higher export prices provided more earnings in terms of value. India exports more than 80% of total castor seed output in the form of oil. 2.5 Export of Castor seed oil by India 900 2.0 800 Quantity (MT) 1.5 1.0 700 600 Value(Rs.cr) 0.5 500 0.0 400 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 Quantity(Lakh MT) Value (Rs.cr) Source: seaofindia Note: only through Mumbai and Kandla ports and 2007-08 data till March 2008 Castor seed meal is another major derivative of castor seed exported by India. This oil meal exports have increased 4-5 times in the past five years. India exported record oil meal of 3,30,475 tonnes during 2007-08 up from 65,550 tonnes shipped in 2003-04. 350000 Export of Castor seed oil Meal by India MT 300000 250000 200000 150000 100000 50000 0 2003-04 2004-05 2005-06 2006-07 2007-08
Current production scenario Gujarat is largest producer of castor seed in India and other major producers are Rajasthan and Andhra Pradesh. It contributes about 70% of total domestic output. Output is estimated around 9.09 lakh tonnes in 2007-08, up by 16% from previous year. Yield has been increasing significantly along with area especially in Gujarat has resulted into bumper harvest of the crop last year. Area under castor seed has increased by whooping 26% in 2007-08 to 3.54 lakh hectares. Gujarat has highest yield with 1838 kgs per hectares. Higher rainfall last year mainly in western parts of the country and improved irrigation facilities in these two major states led to sharp rise in output. Gujarat has about 20 castor seed processing mills and major hub for castor seed industry. State wise Area, Yield and Production of Castor seeds in All India (2007-08) District Estimated Area Under Crop* ('000 ha.) Estimated Production* ( '000 tonnes) Estimated Yield * (Kg/ha.) 2006-07 2007-08 % Change 2006-07 2007-08 % Change 2006-07 2007-08 % Change Gujarat 281.59 354.33 26 494.81 651.22 32 1757 1838 5 Rajasthan 114.9 118.01 3 135.24 142.88 6 1177 1211 3 Andhra Pradesh 248.84 232.56-7 113.57 83.13-27 456 357-22 Other States 52.69 43.5-17 40 32.63-18 759 750-1 Total 698.02 748.4 7 783.62 909.86 16 1123 1216 8 Source: www.seaofindia.com Market influencing factors Sowing and progress of south-west monsoon in western parts of the country Production of castor seed in India and also in China and Brazil Arrivals pattern in spot markets Export demand for Indian castor oil and exchange rate Prices of other edible oils
Price analysis Castor seed prices have rallied by about 87% in the last two years and touched all time high of Rs.525 per quintal. Prices were almost range bound around Rs.250-350 prior to 2006. Bullish trend started from second half of 2006 and prices never saw back. Strong export demand for castor oil and bullish tone in other oils including crude oil, soy oil and mustard oil supported the sharp rise in prices. Soy oil prices have gained by around 85% and crude oil prices moved up by more than 70% in the same period. 550 Castor seed Spot prices (NCDEX Deesa) 500 450 400 350 300 250 200 7/22/05 9/22/05 11/22/05 1/22/06 3/22/06 5/22/06 7/22/06 9/22/06 11/22/06 1/22/07 3/22/07 5/22/07 7/22/07 9/22/07 11/22/07 1/22/08 3/22/08 Price per Qtl Factors to be watched out Production during 2007-08 has been estimated at 9.09 lakh tonnes increased by 16% compared to last year Gujarat is largest producer with production of 6.5 lakh tonnes in 2007-08 and major hub for castor seed industry Carry forward stocks were negligible due to low output last year India has exported 1.7 lakh tonnes of castor seed oil in 2007-08 compared to 1.9 lakh tonnes in last year (till March 2008) Prices have gained by 46% in last one year Export demand remain strong especially from China Export earnings have affected by appreciating Rupee in the last one year Export prices are quoting around $1400 per MT (FOB)