Against last year's 8 lakh tonnes, the current season's crop though at same level seems short of expectations. But the recent scattered heavy rains have however, slightly improved the prospects. The balance rains next month could further improve the prospects of good groundnut crop.

Erratic rain distribution has affected the yield as well as the flowering process. The heavy rainfall in the AP has affected the standing crop of groundnut and cotton, while the progress in the Karnataka and Maharashtra remains satisfactory.

Thanks to the aggressive campaign to nourish water reservoirs and soil moisture, several non-government organizations (NGO) have constructed small check dams to hold rainwater. The exercise is giving it's result as crop in the most of the rainfed area survive despite month long's delayed interval. A cloudy weather has also partly helped the crop, however scenario is not as rosy as it was seem in the early July.

Among the key groundnut growing districts, crop in the Jamnagar district is reported to be excellent conditions, while most of the standing crop in the Junagadh districts is seen in relatively good shape. Crop around Rajkot, Gondal, Atkot is seen mixed as some of the areas have been dry. A last minute monsoon lashes in around rain fed districts like Amerali, Bhavnagar and Porbanadar has improved the crop prospects. Some of the provinces like Valbhiput, Botad -- leading producing centers of cotton and sesame -- are facing acute water shortage and output would be lower. The only silver line is improvement in the under ground water levels and cloudy weather - which is protecting crop from the heat.

Area under groundnut cultivation at 1.7 million hectares has remained unchanged. Despite relatively unremunrative prices, Saurashtra still remains largest producer of groundnuts.

Thanks to delay in the resumption of monsoon, farmers have preferred small variety, locally known as Ubhadi. It requires relatively less water and cultivation takes around 90 days, it needs approximately 350-400 mm rains. The cultivation of bold variety remains below normal due to rains, while cultivation time is 120 days.

It needs at least four timely as well as equally distributed rainshowers. The yield per hectare is expected to remain around six mounds per hectare, according to farmers, however it depend on the soil and moisture level.Arrival Schedule : According to a leading oilmiller of Rajkot, the groundnut sown in the irrigated land and around the late June is expected to arrive around first half of October, while remaining seeds will hit the market by first half of November.

Normally groundnut arrivals peak up after Dipavali. This year arrivals could be delayed beyond Dipavali as monsoon has been legging behind by around 30 days, depending upon the balance monsoon cycle.Market Outlook : Against the increasing availability of cheaper edible oils, groundnut oil has managed to retain some of its marketshare with the affluent class. Therefore, it is relatively prices inelastic.

Groundnut exports are falling since last couple of years because of higher alphatoxin. EU, once a large market for the Indian HPS variety has been diverted toward Argentina and USA.

The bleak export prospect would increase domestic availability. Higher demand for the protein rich Indian meal is also encouraging crushers, however once a royal industry is losing it's charm. Margins have become wafer thin hence adulteration and malpractices are the incentive to survive. As a result adulteration of the cheaper soft oil is seen increasing. Some honest millers have been diverted toward crushing of cottonseed as the cotton oil is fast replacing groundnut. Usage of imported palm and soya oil is also seen rising.

Though the Indian kitchen is flooded with the cheaper vegetable oil, the marketshare of groundnut oil is likely to decline further. It is definitely down, but not out.

(The author works with emecklai.com. The views expressed here are his own and not of the organisation he works for).