Nafed finds way to clear mustardseed stocks
The government has found a unique way to dispose of a huge stock of mustardseed, which is lying with National Agricultural Co-operative Marketing Federation of India (Nafed) as a result of procuring the oilseed at minimum support price from farmers.
By Ratna Ganguli, TNN |
KOLKATA: The government has found a unique way to dispose of a huge stock of mustardseed, which is lying with National Agricultural Co-operative Marketing Federation of India (Nafed) as a result of procuring the oilseed at minimum support price from farmers.
The directorate of vanaspati, vegetable oils and fats, under the food ministry, has recently notified that 20% of vanaspati ingredients should be made of mustard oil. Earlier, the government has asked vanaspati units to source 12% of vanaspati ingredients from other indigenous oils. The purpose behind this is to boost domestic sale of these oils.
With the recent notification, the vanaspati units have been mandated to source 32% of vanaspati ingredients from indigenous oils. This will be in addition to crude palm oil (CPO), which as the main ingredient of the vegetable fat, is totally imported from Malaysia and Indonesia. Vanaspati units are now using mainly rice bran oil to meet the stipulation of sourcing 12% of its ingredients from local oils.
Industry sources said the recent notification has been issued by the government to bail out Nafed, which is now floundering with a huge inventory of mustard seed, currently estimated at 34 lakh tonnes. Mandated by the government, the co-operative agency has procured about 37 lakh tonnes over the past couple of years at minimum support prices ranging between Rs 1,700-Rs 1,750 per quintal. Out of the total procurement, it could dispose off only three lakh tonnes.
However the directorate has said that the new notification will come into force as and when the mustard oil supply from Nafed’s stock will be ensured to vanaspati units by the agriculture ministry. It has also asked Nafed and the department to soon spell out the oil price, which will be offered to vanaspati units.
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The industry, while accepting the government mandate, has requested the latter that the price of mustard oil, produced out of Nafed’s stock, should be at least cheaper by Rs 1,000 per tonne than the landed price of CPO. Currently, CPO is ruling at Rs 38,000 per tonne in the domestic market as against mustard oil price at Rs 40,000 per tonne. Too busy to trade in stocks? Invest in Mutual Funds with ET Money!
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