The government on Tuesday advised leading edible oil associations to ensure that the MRP of each oil is maintained till the availability of edible oil stocks imported at zero per cent and 12.5 per cent basic customs duty (BCD), and take up the issue with their members immediately.
This was conveyed by the government during a meeting with the representatives from the Solvent Extraction Association of India (SEAI), the Indian Vegetable Oil Producers’ Association (IVPA), and the Soybean Oil Producers Association (SOPA) here to discuss the pricing strategy.
The government has implemented an increase in the basic customs duty on various edible oils to support domestic oilseed prices.
Effective September 14, the BCD on crude soybean oil, crude palm oil and crude sunflower oil has been raised from 0 per cent to 20 per cent, making the effective duty on crude oils 27.5 per cent.
Additionally, the BCD on refined palm oil, refined sunflower oil and refined soybean oil has been increased from 12.5 per cent to 32.5 per cent, making the effective duty on refined oils 35.75 per cent.
The government had earlier reduced MRP of edible oils such as sunflower oil, soybean oil, and mustard oil to bolster domestic oilseed farmers, especially with the new soybean and groundnut crops expected to arrive in markets from October.
The decision, said the government, 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. According to the government, the industry has been advised from time to time to align the domestic prices with the international prices so as to reduce the burden on the consumers.
There is close to 30 lakh metric tonnes (LMT) stock of edible oils imported at lower duty which is sufficient for 45 to 50 days domestic consumption, said the government.