They said the production of edible oils in the domestic as well as international market is ample and that if the government does not increase import duty, then farmers will suffer as they will not get remunerative prices for their crops.
The government reduced the duty on edible oils last year to keep prices in check. The Soybean Processors Association recently made a presentation to the commerce ministry, urging it to increase import duty on all types of edible oils. India annually imports 14-14.5 million tonnes of edible oils to meet its domestic demand.
Pradeep Chowdhry, managing director, Gemini Edibles & Fats India, said, “Prices of edible oils have fallen significantly compared to last year and are now not pinching the pockets of consumers. The supply chain of oils is heavily loaded, which is why the government should now increase the import duty of edible oils so that our farmers get the price for their produce.”
A bumper mustard crop of more than 12 million tonnes is expected this year. Global soybean production will hit a record high this year, with Brazil alone having an additional production of 30 million tonnes compared to last year.
Import duty on crude varieties of palm oil, soybean oil and sunflower oil is currently zero. However, after taking into account 5% agri cess and 10% social welfare cess, the effective duty on crude varieties of these three edible oils is 5.5%. Basic customs duty on refined varieties of palmolein and refined palm oil is 12.5%, while social welfare cess is 10%. So, the effective duty is 13.75%.
Sudhakar Desai, president, Indian Vegetable oil Producers’ Association (IVPA), said, “…recommended increasing refined palm oil duty to 20% while retaining the same duty rate on crude palm oil imports.”
