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New Delhi: A series of import duty cuts in the last two weeks have led to a reduction in prices of most edible oils by up to 7 per cent, bucking the trend of increasing costs during the normal festive period.
About 60 percent of India’s edible oil demand is Complete by import. They mainly manufacture crude and refined forms of palm, soybean and sunflower oils.
as many as four Between June and September, import duty was cut in respect of three edible oils after the following: sharp rise in prices in the last months. In the same period, palm oil import rules also relaxed, in another bid to check the price hike.
The first cut in duty was introduced On June 29, when the standard rate of duty on crude palm oil was reduced by the central government. NS Latest That came on September 10, when the standard rate of duty on crude palm oil was reduced from 10 per cent to 2.5 per cent and on crude sunflower and soybean from 7.5 per cent to 2.5 per cent. Duty on refined versions of all three oils was reduced from 37.5 per cent to 32.5 per cent.
This, in turn, has helped bring down the price of vanaspati, a cheaper ghee variant, and a household staple derived from palm oil.
According to daily commodity price data From the consumer affairs department, sunflower oil price fell to Rs 15,000 per quintal on September 21 from Rs 16,176/quintal on September 7, a decline of 7 per cent. Meanwhile, palm oil prices fell nearly 3 per cent to Rs 12,303 per quintal from Rs 12,666 in the same period. (see graphic for more).
Mustard oil, which is major oilseeds produced In India, it is the only outlier in the trend, increasing its price by 7.5 per cent in the same period.
Experts attribute this to the disruption caused by the pandemic, which they say outweighed the expected impact of a healthy crop production this year.
Government an estimate Suggest frequent cuts in import duties – the latest of which came on September 10 – amount to Rs 4,600 crore.
the exception of mustard
However, the average wholesale price of mustard has increased between September 7 and September 21. Experts say that this is because despite a healthy crop, mustard seeds have not reached the market in desired quantity.
Shammi Aggarwal, Managing Director, Pansari Group, a leading conglomerate that deals in edible oils, said, “Despite good crop production in February and March, the domestic market has witnessed maximum volatility and rise in the prices of mustard oil.
“Disruption in logistics and manpower supply due to the pandemic and the nationwide lockdown paved the way for poor circulation and sale of in-season mustard and mustard oil.”
According to Agarwal, “the sudden increase in the demand for mustard oil caused the market to exhaust its mustard resources, causing the rate to skyrocket”.
“We will not see a sudden drop in edible oil rates until the new crop cycle is harvested. Therefore, the government has taken this step to reduce the import duty on edible oil. However, depending on the quantity and quality of the produce, the expected change in rates would be observed post-harvest of the new crop.
(Edited by Sunanda Ranjan)
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