Business Daily from THE HINDU group of publications
Friday, Sep 08, 2006
Business Daily from THE HINDU group of publications Friday, Sep 08, 2006 |
|
|
|
|
|
|
|
Agri-Biz & Commodities - Oilseeds & Edible Oil Industry & Economy - Exports & Imports Spurt in imports of palm stearin, PFAD Harish Damodaran
New Delhi , Sept. 7 Revenue authorities are flummoxed by the huge spurt in imports of palm fatty acid distillates (PFAD) and crude palm stearin (CPS) — raw materials normally used in soap manufacture. There is apprehension that a significant quantum is being illegally diverted for adulteration of vanaspati, which, they warn, is also dangerous from a health perspective.
`Abnormal'
As per latest data, cumulative PFAD imports during the ongoing 2005-06 oil year (November-October) stood at 1,25,129 tonnes till July, a 89.5 per cent jump over the corresponding 66,017 tonnes for 2004-05. Likewise, imports of CPS have soared by 48.8 per cent from 1,34,627 tonnes to 2,00,284. "It is abnormal. There is no reason why there should be such a massive increase in demand from the soap industry," officials admitted. Soap manufacturing essentially involves `neutralisation' or reacting fatty acids (PFAD and CPS) with a strong alkali (caustic soda). The end result is a water-soluble sodium salt of fatty acid — `salt' in common parlance. A reverse case is when fatty acids are mixed with glycerine using a catalyst. The product here is a `triglyceride' — crude palm oil (CPO) — in which three fatty acid molecules are attached to one molecule of glycerine. But the CPO obtained is of non-edible grade oil, with free fatty acid (FFA) content above 20 per cent. The fear being expressed now is that a big chunk of the imported PFAD and CPS is going for adulteration of vanaspati. "They use the fatty acids to first make CPO and reduce the FFA content to extent possible. This is followed by the normal hydrogenation (solidifying the liquid fat by adding hydrogen) employed for producing vanaspati," industry sources said. The problem with this process, however, is that the FFA cannot be reduced to edible grade of 2-5 per cent and the resultant vanaspati is largely used as an adulterant.
Duty structure
One reason for this perverse practice is the duty structure on imports. Currently, edible-grade CPO is importable at 78.2 per cent, whereas it is 38.3 per cent on PFAD and 17.2 per cent on CPS. Although imports of non-edible oils are technically restricted to soap manufacturers and other `actual users,' the sources said this is being circumvented by the mushrooming of so-called soap units that actually produce vanaspati.
Centred in North
"Most of this activity is in northern centres such as Kanpur, Rudrapur, Bhatinda and Hissar," the sources added. In fact, the bulk of the increased imports have been through the Kandla port, catering to these centres. PFAD imports via Kandla have gone up from 5,498 tonnes to 31,236 tonnes, while rising from just 5,289 tonnes to 53,646 tonnes. Till recently, the same vanaspati manufacturers were importing non-edible CPO at a concessional duty of 20 per cent available to `actual users.' This facility was withdrawn on September 30, 2005 and the duty on non-edible CPO was raised to 100 per cent, even while those on PFAD and CPS were left unchanged.
More Stories on : Health | Oilseeds & Edible Oil | Exports & Imports | Soaps & Detergents
Article E-Mail :: Comment :: Syndication :: Printer Friendly Page
|
Stories in this Section |
|
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription Group Sites: The Hindu | Business Line | Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |
Copyright © 2006, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line
|
