Import Oil Seeds

To halt the rise in edible oil prices, Centre reduced import duties on Oils

"To halt the rise in edible oil prices, Centre reduced import duties on Oils"

In order to halt the rise in edible oil prices, the central government reduced import duties on sunflower, soybean and palm, oils.

With effect from today, September 11, the import duty and cesses on crude palm oil (CPO) will be 24.75% instead of 30.25%. It will be reduced to 35.75% from 41.25% for refined, bleached, and deodorized (RBD) palm oil. The new rate for crude degummed soybean oil is 24.75% versus 30.25%, and the rate for refined soybean oil is 35.75% versus 41.25%. Crude sunflower oil duty has also been reduced from 30.25% to 24.75%.

Also Read: Urge to keep up present duty form on soybean and sunflower seed oil-SOPA

The sunset clause appears to have been dropped, so there will be no auto revision beginning October 1, says Mr BV Mehta, the Executive Director of the Solvent Extractor Association of India

‘The current domestic bullishness in edible oils is being driven by a lack of mustard seed arrivals. In our meeting with the Food Secretary on Friday, we proposed lowering the import duty on rapeseed oil to match that of soya and sunflower oil, or even lower, as this would have the desired beneficial effect on runaway mustard oil prices. This will also help to cool down all edible oil prices, as international edible oil prices have begun to fall,’ he said.

Other instructions

The Centre has guided all the states to direct retailers to prominently display the prices of all edible oil brands for clarity and the benefit of consumers, as well as to take strict action against hoarding at the wholesaler, miller, and refiner levels.

Following a meeting with state officials and industry players, Central Food Secretary Sudhansu Pandey imposed a stock limit on traders as well as the possibility of fixing MRPs for edible oils, emphasizing that market forces will decide rates in a healthy competitive environment.

Price increases

In recent months, the Centre has reduced import duties on a variety of edible oils and asked states to collect information on edible oil and oilseed stock from wholesalers, millers, refiners, and stockists. It has also announced an 11,040 crore palm oil mission. Retail edible oil prices in the country have risen by 41 to 50% in the last year.

Pandey believes that in recent government analyses, the expected arrival of a good Kharif soybean crop by the end of September, and weakening global price trends in soyabean oil and palm oil will help to cool domestic prices.

Also Read: Edible oils imports dropped by 27% in Feb 2021 due to excessive imports and higher prices

The Kharif soybean crop for the 2021-22 crop year (July-June) is anticipated to be 5-10% higher than the same period the previous year. The government has also agreed to increase support price, which should encourage farmers to grow oilseeds, so rabi (winter) crop acreage under oilseeds is expected to be higher, according to Pandey.