Indian farmers intend to reduce the acreage of soybeans up to 10% this year in response to falling prices, which increases the probability of import of edible oils such as palm oil and soybean oil.

Soybean is the main oilseed crop, which is sown in the summer in the world's largest importer of edible oils, but the prices are decreased by 10% over the past two years, while prices for pulses such as pigeon peas, has nearly tripled over the same period.

Lower soybean production will force the country to increase imports of edible oils and to maintain prices. It may also limit the export of soybean meal India, given that the prices of non-GMO products already above the international.

A further increase in prices due to lower offers maybe even make import of soybean meal is cost effective for local consumers.

The last two or three years soybeans gave lower returns than competing crops, such as legumes, management said Ruchi Soya, a major processor of edible oils in the country.

Farmers planted soy of 11.63 million hectares in the 2015/16 season. 10% reduction will reduce the area to approximately 10.5 million ha in 2016/17 marketing year, which begins in July.

Most Indian farmers begin to cultivate soy and beans, which depend on the rains, in June, after the arrival of the monsoons. These crops are sown chiefly in the States of Madhya Pradesh in Central India, Maharashtra in the West, Rajasthan in the North-West and Andhra Pradesh and Karnataka in the South.

Soybean production fell by 20% in the 2015/16 year to a ten-year low because of drought and pests have damaged the crop.

India exports soybean meal mainly to Asian countries, but the decrease in production has forced her for the first time in many years import soy meal and in small quantities.

As the country imports most of its edible oil, limiting the supply of soy means the increased imports in the 2016/17 year, according to Kotak Commodity Services Ltd.

India imports palm oil mainly from Indonesia and Malaysia, while have imported soybean oil from Argentina and Brazil.

Source: Thomson Reuters