Project report for Cotton Seed Oil Cake Industry

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Cotton seed oilcakes are the semi-solid content left over after the oil has been removed from the cotton seed. It's basically the remaining commodity after the oil has been removed from cotton seeds. Cotton seed cakes, such as groundnut cake expeller pressed and solvent removed cotton seed cakes, are available for feeding livestock. Cotton seed oil cake is often used as cattle feed because it has a protein content of approximately 25%, making it a good source of nutrients for cattle. Cotton seed oil cake use by cattle helps increase milk viscosity, which is why it is more widely used in cattle feed (for human consumption). Cotton seed oilcake has a higher protein content, making it ideal for animal feed in India. Since milk consumption in India is growing and is expected to continue to increase in the future, the domestic cotton seed oil cake demand is expected to expand year after year.

Kapas or raw cotton is first ginned to separate the lint from the cotton seed before being used to make oilcake. Lint is the heavily coated white/rusty, long and woolly hairs that surround the crop, and it is the most commonly used commodity in the textile industry. Cotton seeds are eventually crushed for oil extraction, and the by-product that persists after oil extraction is known as Cotton Seed Oil Cake or Kapas Khali. Gujarat, Maharashtra, Andhra Pradesh, and Punjab are the major producers of cotton seed oil cake in India. Cotton seed oil cake, often identified as cotton meal, has an 85-86 percent return rate and is sold as meal, cake, flakes, or pellets. The colour of good quality oil cake is greenish yellow. Cottonseed oilcake is the second most important commodity derived from the cotton seed, accounting for over 30% of the overall product value.

Market potential & Strategy

India is the world's second-largest producer of cotton seeds, after China. Cotton seed oil cake has a market share of about Rs. 7300 Cr ($73 billion) in India. Because most of it is consumed in the domestic market, India has a very small export market share of only 0.6 million tonnes per year. In light of current local demographics, demand from northern India, especially Rajasthan, has risen slightly in recent weeks, causing prices to rise. However, there are fears that half of the entire output is now sitting in factories and go-downs. There are estimates that the nation will manufacture about 9 million tonnes of cake. Cotton cake is reportedly in high demand in Maharashtra, Punjab, Haryana, and Rajasthan. Since the moisture content of cottonseed remains high, prices are likely to stay stable until the moisture content begins to decline.

Cotton seed oil cake can also be used as a fertiliser on its own or in combination with other ingredients. Nitrogen, phosphate, potash, and a variety of other plant food components are abundant in the Oil cake. Cottonseed oil cake consistency is graded according to ISI specifications based on oil content, protein, fibre, moisture content, sand/silica, and colour. Due to the Covid-19 virus, intake was limited to 250 million bales last season. This suggests that, owing to an improvement in the demand forecast, carryover stocks may be decreased year over year. Markets for cotton have been high - affinity in line with the bullish fundamentals. Physical trades are showing steady improvement in terms of volumes as export potential for Indian cotton remain better and domestic demand continues to increase following the lockdown process. With very less elasticity, withstanding the aftermaths of covid-19, the sector is surely here to stay and profitability seems a practical possibility in the sector.

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