New Delhi: The Centre today advised edible oil associations to maintain MRP of oil till the availability of edible oil stocks is imported at 0% and 12.5% basic customs duty (BCD) and take up the issue with their members immediately. To bolster domestic oilseed farmers, an increase in basic customs duty on various edible oils is effective from September 14, 2024.
The Secretary of the Department of Food and Public Distribution (DFPD) chaired a meeting with the representatives from the Solvent Extraction Association of India (SEAI), Indian Vegetable Oil Producers’ Association (IVPA) and Soyabean Oil Producers Association (SOPA) here today, to discuss the pricing strategy.
Earlier also, in pursuance of the Department’s meetings with leading edible oil associations, the MRP of edible oils such as sunflower oil, soyabean oil and mustard oil were reduced by the industry. The reduction in oil prices had come in the wake of the reduction of international prices and reduced import duty on edible oils making them cheaper. The industry has been advised from time to time to align the domestic prices with the international prices to reduce the burden on the consumers.
The Centre has 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 soybean oil, crude palm oil, and crude sunflower oil has been raised from 0% to 20%, making the effective duty on crude oils to 27.5%. Additionally, the basic customs duty on refined palm oil, refined sunflower oil, and refined soybean oil has been increased from 12.5% to 32.5% making the effective duty on refined oils 35.75%.
These adjustments are 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 Ministry of Consumer Affairs, Food & Public Distribution, stated today. It elaborated that 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 stated. It mentioned that the Central Government was also aware that there was close to 30 LMT stock of edible oils imported at lower duty which is sufficient for 45 to 50 days of domestic consumption.
– global bihari bureau
