Reduction of import duties: cooking oil prices drop from 6 to 8 Rs / kg due to reduced import duties

The government has reduced import duties on cooking oils to provide relief to consumers during festival season as prices have been high for more than a year. Import duties on crude and refined palm oil, soybean oil and sunflower oil have been reduced from 16.5% to 19.25% with effect from October 14 to March 31, 2022. During this time, the import of palm oils in a single month has reached a period of 25 years. high in September 2021 due to bullish sentiments and high demand.

The impact of the reduction in duties on crude palm oil is around Rs 14,000 / tonne, while it is Rs 20,000 / tonne on crude soybean oil and crude sunflower oil. .

“Retail prices could drop by 6-8 rupees / kg. However, consumers may not take full advantage of the tariff reduction, as Malaysian prices increased after India announced the tariff reduction,” he said. said BV Mehta, executive director of Solvent Extractors. ‘Association (SEA).

“As global cooking oil prices are expected to remain firm over the next 4-6 months, we may not see a drastic correction in domestic prices,” he added.

The industry expressed concern about when the decision was made. “As farmers harvest a record crop of soybeans and peanuts, reduced import tariffs may affect farmers’ achievement,” Mehta said.

From February 2021, the central government gradually reduced import duties on edible oils and froze the tariff value for almost two months until July / August 2021. In recent months, it has stopped futures contracts of mustard and imposed a stock limit on edible oils and oilseeds. to control inflation in cooking oils.

According to SEA, the monthly import of palm oil in September 2021 at 12.62 tonnes lakh was the highest in 25 years since India started importing palm oil in 1996. Cumulative imports in during the 11 months from November 2020 to September 2021 increased by 2%.

In the first 11 months of the olive year (November-October), Indian palm oil imports increased by 18% due to lower tariffs, while other cooking oils, including soybeans and sunflowers, fell 19% due to high prices for soybeans and sunflowers. oils on the international market. Due to the historically high prices of mustard oil, India has also started importing rapeseed oil.

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Felix J. Dixon

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