Munich - People in the southern German state of Bavaria began voting Sunday in a crucial election that could see the ruling Christian Social Union (CSU) losing its absolute majority.

The Bavarian sister party of Chancellor Angela Merkel's Christian Democrats (CDU) is facing a voter backlash in the state where it has ruled alone since 1966.

If the CSU wins fewer than half the 180 seats in the parliament in Munich, it could signal a weakening of support for the conservative camp and hurt Merkel's chances of retaining power in federal elections scheduled for September next year.

The CSU's good showing in Bavaria in the 2004 general election helped elevate Merkel to power at the head of a grand coalition with the left-of-centre Social Democrats (SPD).

But opinion polls are predicting a swing by the 9.3-million-strong Bavarian electorate to smaller parties such as the Greens, the liberal Free Democrats (FDP), the regional Free Voters and the pro- labour Left Party.

The SPD is not expected to profit from the CSU's eroding support, with opinion polls putting it at around 20 per cent, roughly the same as in the last state elections five years ago.

The CSU is tipped to win between 47 and 49 per cent, well below the 60.7 per cent they polled in 2003 when the party was led by Edmund Stoiber.

The Alpine state, where some of Germany's leading companies have their headquarters, including Siemens and BMW, is one of the country's most prosperous regions.

"I am convinced we will achieve our stated goal of 50 per cent or more," said Guenther Beckstein, 64, who was elected premier last year after Stoiber was toppled in a party rebellion.

Losses by the state-owned bank BayernLB, the scrapping of a prestigious super-fast train link to Munich airport and a controversial smoking ban have led to voter discontent with the leadership duo of Beckstein and party chairman Erwin Huber.

If the CSU loses its absolute majority it could be forced into a coalition with the FDP, which is seeking to enter parliament again after an absence of 14 years.

Opinion polls show the FDP clearing the 5-per-cent hurdle needed for parliamentary representation, along with the Free Voters and the Greens. The Left was hovering at just below 5 per cent. (dpa)