General Characteristics

• Kapaskhalli (cottonseed extraction/meal) is a byproduct of the cottonseed industry.
• Cottonseed is a by-product of the cotton plant, which is primarily grown for its fibre. Although cotton has been grown for its fiber for several thousand years, the use of cottonseed on a commercial scale is of relatively recent origin. 
• Cottonseed was a raw agricultural product, which was once largely wasted. Now it is being converted into food for people; feed for livestock; fertilizer and mulch for plants; fiber for furniture padding; and cellulose for a wide range of products from explosives to computer chip boards.

Global Scenario

• Annually around 15 - 16.5 million tons of cottonseed meal is produced globally. Globally, the oil content of cottonseed is 18%, and the remaining portion is the cottonseed meal. 
• Most of the production of cottonseed meal is consumed in the country of production itself, limiting the global trade to just 5-6 lakh tons a year. 
• China (1-1.2 lakh tons) is the single largest exporter, while Europe (2 lakh tons), South Korea (1-1.5 lakh tons) are the largest importers of cottonseed meal. 
• Cottonseed is the second most commonly produced oilseed in the world just slightly ahead of soy. However, in 2003-04 rapeseed/mustard has marginally overtaken this seed. 
• The global production of cottonseed is around 35 million tons in the recent years. The major producers of cotton are also the major producers of cottonseed. China, USA, India, Pakistan, Uzbekistan and Brazil are the major producers globally.

• Cottonseed is a traditional oilseed of India. It is estimated that cottonseed production will be around 33% of the cotton production in bales. Around 80% of the seed is marketable surplus and arrives in the market for being crushed to oil. The remaining is used as seed is fed to cattle. 
• India's cotton output and along with it the cottonseed, meal and oil output varies considerably from year to year in response to the vagaries of weather and pest attacks.
  India's cottonseed production in 2002-03 and 2003-04 is estimated at 36.3 and 43.4 lakh tons respectively. 
• India's cotton output and along with it the cottonseed, meal and oil output varies considerably from year to year in response to the vagaries of weather and pest attacks.
  India's cottonseed production in 2002-03 and 2003-04 is estimated at 36.3 and 43.4 lakh tons respectively. 
• India produces around 2 million tons of cottonseed meal a year. 
• The protein content of the scientifically produced meal is 40-42% against 20-22% in the traditionally processed meal. The cattlefeed manufacturers prefer this meal as it contains lesser amount of gossypol, which if consumed in larger amounts is a poison for cattle.
• However, in India mainly undecorticated meal is largely produced. Several associations are promoting the production of decorticated cake in India and the production of this is expected to increase in the country.
• India used to be a major exporter of cottonseed extraction around two decades ago. However, the demand for other oil meals like soymeal, has lowered the cottonseed demand globally. In addition, the low availability of decorticated meal in India has also been a major reason for the fall in exports.
• The major importers of Indian cottonseed meal (undecorticated) used to be Thailand. India in 2002-03 exported only 50 tons of decorticated cottonseed meal. In 2003-04, too there have been no significant exports. India does not import cottonseed meal.

• Akola, Parbhani, Nagpur, Yeotmal are the major trading centers where cottonseed from the cotton procured by the Maharashtra State Cooperative Cotton Growers Marketing Federation is auctioned off.

Trade Scenario

• Cottonseed is sold through weekly auctions in Maharashtra. In other states, there is an active cash market in the season. Cottonseed arrives in the market as a by-product of ginning operation carried on cotton. It is sold off immediately. 
• The industry is largely un-organised, though several associations have been trying for the upliftment of the industry and scientific processing practices. 
• The prices of oil and meal display good volatility, with it falling during the peak arrival period (October - January. The prices of meal are dependent on the prices of other commercially important oils like soymeal. 

Daily Variation in Undecorticated Cottonseed Meal Prices at Mumbai (2003-04)

Markets Influencing Factors

• Variations in cotton production and its effect on cottonseed, meal and oil production in the country. 
• The arrival of cottonseed for crushing from the ginning centres of the country. 
• Comparative price with other oilseeds, oil and meal in the domestic market.
• The demand from the cattle-feed industry, which is the major consumer of cottonseed mea.