The Hindu Business Line : Edible oil duty cut: ‘No gain to consumer’

Home Page - Economy
Agri-Biz & Commodities - Oilseeds & Edible Oil
Industry & Economy - Excise and Customs
Edible oil duty cut: ‘No gain to consumer’

Hotels, bakeries, vanaspati sector only beneficiaries

Virendra Pandit

Ahmedabad, March 25 Edible oil companies, which have started reducing prices to between Rs 2-6 a kg recently following import duty reduction announced by the Government last week, feel that the ordinary consumer can benefit only when duty is reduced on soya oil as well.

On March 20, the import duty on crude palm oil, including crude palmolein, was slashed from 45 to 20 per cent and that on refined palm oil, including RBD palmolein, from 52.5 to 27.5 per cent by the Centre. While welcoming the import duty reduction on these oils to improve supplies, oilseed crushers and manufacturers in Gujarat maintain that the actual beneficiaries of the Government move were hoteliers, bakeries and the vanaspati industry which use huge quantities of palm oil and they are unlikely to pass on the price reduction to the consumer.

The common consumer — in many parts of central and western India — uses soya oil for household cooking, which has seen no price reduction. Mr Vijay Gupta, Chairman and Managing Director, Gujarat Ambuja Exports Ltd (GAEL), an oil-maker, told Business Line on Tuesday that the prices of all edible oils could go down further by Rs 3-4 per kg if the Government reduced duty on soya oil as well to 20 per cent.

Unless all edible oils are provided a level-playing field, the prices of this essential commodity can hardly benefit the actual consumer.

Repercussions

An official of Adani Wilmar Ltd, makers of Fortune brand edible oils, said reduced prices of palm oil have pushed some consumers towards it; ironically, the price of palm oil in Gujarat has gone up by Rs 3 per kg during the last two days.

As a result of import duty cut, Gokul Refoils reduced the palm oil prices by Rs 4 a kg, while KS Oil announced a price cut of Rs 2 a kg on mustard oil.

Similarly, cottonseed oil, used mainly for frying purposes, has seen prices go down by Rs 3 a kg.

More Stories on : Economy | Oilseeds & Edible Oil | Excise and Customs

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page