As govt plans to buy soyabean at MSP, industry demands increase in import duties of cooking oils
Following the central government’s soyabean MSP procurement announcement, the processing industry has requested a 15% increase in import duties on cooking oils to mitigate rising raw material costs. The MSP for soyabean is Rs 4892/quintal, though market prices have fallen below Rs 4000. The industry also seeks solutions for cooking oil price pressures, including higher import duties or the Bhavantar scheme.
After the central government announced procurement of soyabean to support prices that are ruling below the minimum support price levels, the processing industry has demanded that import duties on cooking oils be increased by 15% to help absorb the jump in raw material prices.
Currently, different oils have different duties. While crude palm, sunflower and soyabean has nil base duty, refined sunflower and soybeans have 17.5% and refined palm oil has 12.5% base duties. The industry has demanded an additional increase of 15% in all the existing base duties.
The central government announced it will procure soyabean at Minimum Support Price (MSP) under the Price Support Scheme in poll bound Maharashtra along with Karnataka and Telangana as the current soyabean prices are close to what they were a decade ago.
As the announcement disappointed the soybean farmers from Madhya Pradesh, who were not included in the procurement scheme, the government said that even MP can propose to implement the scheme.
The MSP of soyabean for kharif 2024 is Rs 4892/quintal, while prices in the open market fell below Rs 4000/quintal before recovering to Rs 4200-4300/quintal.
As prices of soyabean and onions had affected election results in at least eight assembly seats in Maharashtra, the state government requested the centre to procure soyabean at MSP. Soyabean would be harvested around the time when the state would be facing assembly elections.
However, the edible oil industry, which makes profits by selling the oil and the soyabean meal, which is a byproduct of oil production, is worried about realisations.
“The government has looked at only one thing, which is the soyabean prices. But it should also look at the cooking oil prices, which are under pressure due to cheap imports. We need to either increase the import duty on oils or implement the Bhavantar scheme to address the issue of soyabean prices,” said DN Pathak, executive director, Solvent Extractors Association of India (SOPA).
Recommended for you
