SYDNEY, Sept 18 (Reuters) - A bigger Indian oilseeds crop because of a bumper monsoon this year would help compensate for the ills of government policy which relatively discouraged oilseeds production, a leading Indian forecaster said.

     But Dorab Mistry, director of Indian international trading house Godrej International Ltd, said Indian imports of vegetable oil, the main swing factor in the world market, would still not greatly decrease because of the increased local production.

     A bumper monsoon this year would add over one million tonnes to India's vegetable oil production in 2001/02 (November/October) but imports would fall by only 350,000 tonnes, he told the International Association of Seed Crushers congress.

     Indian vegetable oil production would rise to an estimated 8.21 million tonnes in 2001/02 from 7.16 million tonnes in 2000/01. Imports would fall to an estimated 5.15 million tonnes from 5.50 million tonnes in 2000/01.

     The balance would be accounted for by normal growth in per capita consumption, population gains and re-building of stocks.

     Any gains in vegetable oils production in the coming oil year would not be because of government policy but because of the weather, Mistry said.

     ``Fragmented, under-managed, dogged by low productivity and in parlous financial health,'' was his description of India's oilseeds and vegetable oil industry.

     ``Is it any wonder that India has emerged and stayed for the last 20 years as the world's leading importer of vegetable oils? And the shame is that until last year, most of the oils imported were refined oils,'' he said.

     Out of projected world vegetable oil trade of almost 37 million tonnes in 2000/01, India would account for about 15 percent, he said.

     FAILED TO KEEP PACE

     ``Oilseed production in India has failed to keep pace with the rise in consumption or with the rise in the production of cereals,'' Mistry said.

     Indian oilseed production had only risen to 18.6 million tonnes in 2000/01 from 10.61 million tonnes in 1975/76.

     In contrast, Indian government-backed programmes had helped boost Indian wheat production to 69 million tonnes by 2000/01 from 28.84 million tonnes in 1975/76. Rice production rose to 85 million tonnes from 48.74 million tonnes over the same period.

     Indian consumption of vegetable oils rose to 12.56 million tonnes in 2000/01 from 9.95 million tonnes in 1996/97. Per capita consumption rose to 12.20 kilograms from 10.36 kgs in 1996/97.

     Consumption of soya oil rose to 2.2 million tonnes in 2000/01 from 1.6 million tonnes the year before because of low import duties, Mistry said.

     China and India, which together accounted for 25 percent of total global vegetable oil consumption, were both developing policy for more domestic downstream processing of crude palm oil and/or oilseeds, Rabobank International's head of food business in Asia, Peter Greenberg, also told the conference.

     In India, edible oils per capita consumption over the last five years or so had grown by 5.4 percent a year while domestic annual production had grown by only around one percent a year.

     This had allowed a cascade of palm oil imports into India to threaten domestic growers of rapeseed and groundnut, he said.

     But after increases in import tariffs on crude palm oil this year to 75 percent and on refined palm oil to 85 percent, for a total duty of 92.5 percent, importers could make a sustained switch to soybean oil, with its tariff of 45 percent, he said.

     ``Unlike China, which is a crushing play, India is obviously an edible oils play,'' Greenberg said.
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