India’s oilseed sector is undergoing a shift with rapeseed expected to be the top oilseed for a second year, driven by sustained price advantages over soyabeans, according to a US Department of Agriculture (USDA) report.
According to the USDA’s ‘India - Oilseeds and Products Annual’, six main oilseed crops are cultivated in India, with production concentrated in four major categories: cottonseed, peanuts (groundnuts), rapeseed (mustard) and soyabeans.
The four crops were the backbone of India’s oilseed output across various agro-climatic zones, while two additional crops – coconut (copra) and sunflowerseed – had niche positions within specialised market segments in traditional growing regions, the 31 March report said.
In the 2026/27 marketing year, the sharp differences in economic returns among major oilseed crops – first seen in 2025/26 – were expected to continue to reshape production patterns.
“Rapeseed is expected to remain profitable, with prices sufficient to cover input costs and ensure solid margins for growers,” the USDA said.
In contrast, soyabeans were expected to remain less economically viable, as prevailing prices did not offset production expenses. For a second year, this has led farmers to move acreage from soyabeans to more lucrative options such as corn, rice, vegetables and wheat.”
Total oilseed production for the 2026/27 marketing year was forecast at 41M tonnes, a slight decrease from the current year’s level due to a drop in soyabean and cottonseed production.
Rapeseed output was projected to rise by 2%, supported by strong market prices and adoption of high-yield varieties.
“The relative overall oilseed stability … reflects continued adoption of high-yielding seed varieties, and stronger price incentives for rapeseed and peanuts that encourage productivity-enhancing investments,” the USDA said.
As a result, the USDA’s Foreign Agricultural Service (FAS) in India expected average yields to improve to 1.04 tonnes/ha, partially compensating for reduced cultivated area and stabilising the overall oilseed sector.
In 2026/27, the rapeseed planted area was expected to increase by 2% compared to the previous year, solidifying the crop’s position as India's top-ranked oilseed.
The soyabean harvested area was forecast to fall by 3% in 2026/27 compared to the previous year, as farmers shifted to more profitable crops like corn and wheat.
Peanut production was expected to grow by 3% as farmers moved from cotton to the groundnut, while cottonseed output was anticipated to fall by 1% as producers sought higher value alternatives.
Total oilseed crushing activity in 2026/27 was projected to remain flat at 34M tonnes, well below India’s 50M tonne installed capacity.
