Budget 2014: Duty relief to keep cooking oil prices stable

KOLKATA: Cooking oil prices are likely to remain stable despite the expected loss of oilseed crop due to weak monsoon, falling international prices and the finance minister’s move to exempt 15% customs duty on oilcakes.

The duty relief, granted till the end of this year, will give an impetus to the import of oilcakes and help to meet the cooking oil requirement to some extent, said BV Mehta, executive director, Solvent Extractors’ Association of India. “The oil cakes contain 8%-9% of oil and we can extract and refine it to meet the domestic demand.”

At present, very small quantities of oilcakes are imported by India. Generally, palm oilcakes come from Malaysia and Indonesia, rice bran cakes from Bangladesh and Pakistan, copra cakes from Philippines and sunflower cakes from Ukraine.

In the current oil year (November 1, 2013 – October 31, 2014), the country is expected to import 11 million tonnes of oil compared to 10.4 million tonnes imported in the year before.

In kharif 2013, India had produced 32.41million tonnes of oilseeds. As the rains are yet to arrive in full vigour in soybean and groundnut producing states of the country, it is likely that the crop will be less this year. Rajesh Agarwal, spokesperson, Soybean Processors Association of India said “Till now, reports trickling in show that soybean has been sown only in 8-9 lakh hectares of land.”