The Hindu Business Line : Vegetable oil imports up at 45.5 lt; soya oil shipments double

Agri-Biz & Commodities - Oilseeds & Edible Oil
Industry & Economy - Exports & Imports

Vegetable oil imports up at 45.5 lt; soya oil shipments double

G. Chandrashekhar

Soya oil imports have increased to 17.6 lakh tonnes from 7.3 lakh tonnes.

Mumbai , Oct. 6

VEGETABLE oil imports aggregated to a high of 45.5 lakh tonnes (lt) in the first 11 months of the oil year 2004-05, up from 38.8 lt during the corresponding period previous year. The big story is the incredible jump in soyabean oil arrivals past several months. Imports have more than doubled to 17.6 lt from 7.3 lt during the corresponding period in 2003-04.

September saw vegetable oil arrivals continuing with vigour, but slightly less voluminous than the previous three to four months. According to preliminary import data made available to Business Line by the industry portal Oilmandi.com, 3.83 lt of various oils arrived last month.

Imports comprised, broadly, 2.10 lt of soyabean oil; 1.49 lt crude palm oil; 15,000 tonnes of crude palmolein, and the rest refined palmolein (6,000 tonnes) and crude palm kernel oil.

October imports are projected between 4.5 lt and 5 lt, taking the annual total past the 50-lt mark. The country imported the highest quantity of 51.1 lt during 2002-03, a drought year. This year could well match that record, despite the Government claiming higher oilseeds production.

It is ironical that imports are rising, despite the Government designated procurement agency Nafed struggling to cope with about 15 lt.

Rapeseed/mustard was purchased several months ago at the minimum support price of Rs 1,700 a quintal. How the agency would dispose of the stock remains a mystery; but it is certain that with every passing day the cost of the procured material - storage cost, interest - keeps mounting.

With kharif oilseed crop prospects now more or less clear and global market signals pointing to strong vegetable oil prices driven by expanding demand for biodiesel, the domestic market will have to cope with lower domestic raw material for crushing and higher imported oil prices.

Speculation rife over tariff changes: Uncertainties relating to changes in tariff values and duty changes continue to distort the market. Tariff changes, in particular, need more transparency. The Government should announce tariff values at the beginning of every month and revise the rates whenever market conditions warrant.

Worse, players outside the country seem to know about Indian tariff changes ahead of anyone else in the market. In trading centres, such as Kuala Lumpur and Singapore, people seem to be almost certain about imminent changes in Indian tariffs. Often, they are absolutely right.

Speculators are having a field day in such uncertain conditions resulting from wholly avoidable non-transparent way of functioning of the Government.

There obviously is some serious lapse somewhere in the system that needs to be investigated.

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