Problems of Indian farming

| Foreign Markets |

The United States is currently the main importer of Indian agricultural produce. However, this year export from India to USA has not reached a satisfactory level.

Poorer US imports

The main source of concern for Indian exporters is a sudden drop of guar gum sales in USA. This thickening substance is used in food production and in the mining industry. The value of exported guar gum has fallen by 63% in comparison with the previous year, although the total annual volume of sales remains the same. In 2012 guar gum prices soared due to huge demand from American mines excavating shale has (guar gum is used as a controlling agent in hydraulic fractures). Indian agricultural manufacturers were deeply affected by the sudden drop in prices from 1025 INR per kg in April-May 2012 to 200 INR per kg in October-December 2012.

Neighbors do not fare better

 

Another important destination of Indian exports is Bangladesh, a purchaser of confectionery and Asian Palmyra palm (Borassus flabellifer). Fruit of this palm is used for making sweet syrup and sugar. The value of sales fell by as much as 66% in one year. In 2012 export of the palm fruit and sweets was estimated at 150 million USD. In the first quarter of 2013 its value was close to nothing.

Growth of rice

Not all looks bleak, though. India is selling more and more basmati rice to Iran. In the first quarter of this year exports of this product rose by 140%, reaching total value of 682 million USD. Teheran is currently buying up c. 40% of Indian basmati rice, putting the commodity in the top three of agricultural product sold abroad, alongside buffalo meat and guar gum.

 

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