Govt asks oil firms not to hike retail prices, 3 MT of edible oil available | News
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The government has asked edible oil processors not to hike retail prices following recent increase in import duties, as there is enough stock of cooking oils that were shipped at a lower duty.
The food ministry said the stocks imported at lower duties would easily last 45-50 days, and therefore the processors should refrain from increasing maximum retail prices (MRP).
Last week, the Centre implemented an increase in the basic customs duty on various edible oils to support domestic oilseed prices.
Effective September 14, 2024, the basic customs duty on crude soyabean oil, crude palm oil, and crude sunflower oil has been raised to 20 per cent from nil, making the effective duty on crude oils to 27.5 per cent.
Additionally, the basic customs duty on refined palm oil, refined sunflower oil, and refined soyabean oil has been increased from 12.5 per cent to 32.5 per cent, making the effective duty on refined oils to 35.75 per cent.
On Tuesday, Food Secretary Sanjeev Chopra chaired a meeting with the representatives from Solvent Extraction Association of India (SEA), Indian Vegetable Oil Producers’ Association (IVPA) and Soyabean Oil Producers Association (SOPA) to discuss the pricing strategy.
“The leading edible oil associations were advised to ensure that the MRP of each oil is maintained till the availability of edible oil stocks imported at 0 per cent and 12.5 per cent Basic Customs Duty (BCD) and take up the issue with their members immediately,” an official statement said.
“The central government is also aware that there is close to 30 lakh tonnes stock of edible oils imported at lower duty which is sufficient for 45 to 50 days domestic consumption,” it added.
India imports a large quantity of edible oils to meet domestic demand. The dependence on imports is more than 50 per cent of total requirements.
The decision to hike import duties is part of the government’s ongoing efforts to bolster domestic oilseed farmers, especially with the new soybean and groundnut crops expected to arrive in markets from October 2024, the food ministry said.
“The decision follows comprehensive deliberations and is influenced by several factors: increased global production of soybean, oil palm, and other oilseeds; higher global ending stocks of edible oils compared to last year; and falling global prices due to surplus production.
“This situation has led to a surge in imports of inexpensive oils, exerting downward pressure on domestic prices. By raising the landed cost of imported edible oils, these measures aim to enhance domestic oilseed prices, support increased production, and ensure that farmers receive fair compensation for their produce,” the ministry explained.
India imports palm oil from Malaysia and Indonesia, while the country imports soyabean oil from Brazil and Argentina. Sunflower oil comes mainly from Russia and Ukraine.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
First Published: Sep 17 2024 | 10:09 PM IST
