The Centre has asked Madhya Pradesh government to “step in to take necessary action” under the Essential Commodities Act after its team found “very large hoardings” of soyabean and mustard seeds in Dewas, Shajapur and Guna districts in excess of the stock limit prescribed under the law.

Stressing the need for effective enforcement of the EC Act by the States is crucial for ensuring adequate availability of edible oils at reasonable prices, the Union Food Ministry said that teams have been deputed to conduct inspections of the stocks held by retailers, wholesalers, big chain retailers and processors in Maharashtra, Rajasthan, Madhya Pradesh, Uttar Pradesh, West Bengal, Telangana, Gujarat and Delhi.

In Maharashtra and Rajasthan, too, the Central team found large quantities of edible oils in excess of the prescribed quantities under Stock Limit order, the ministry said, adding wholesalers and big retail chain outlets were the main violators.

“The State Governments have been requested to take corrective measures in accordance with the relevant sections of the EC Act,” the food ministry said.

Stock limit

On inspections in the States, there was no mention of quantity found in excess of the fixed limit traders can keep at any point of time.

For edible oils, the stock limit is three tonnes for retailers (including supermarket chains) at each outlet, 50 tonnes for wholesalers and 100 tonnes for supermarket chains at depot level. Processors are allowed to stock maximum 90 days of their “storage/production” capacity of edible oils.

In oilseeds, the stock limit will be applied only to edible grade and will be ten tonnes for retailers and 200 tonnes for wholesalers. It will be 90 days of “production capacity” for processors based on their daily processing.

The Centre on March 30 extended stock holding limit order on edible oils and oilseeds until December 31 this year, effectively putting the curbs in place during this rabi harvest and the next main kharif harvesting period. Earlier, the Food Ministry, on February 3, had notified the order imposing stock limit on edible oils and oilseeds making it mandatory for States to implement it. Then, the Centre had also extended the validity of the stock limits until June 30, 2022 which was to expire on March 31.

The earlier order issued on October 8 had empowered States to impose the stock limits and only Uttar Pradesh, Karnataka, Himachal Pradesh, Telangana, Rajasthan and Bihar had imposed the quantitative restrictions. However, the March 30 Order made uniform quantitative limit for all States effectively making the separate orders passed in these states redundant.

“First, the Centre made it optional. When some States implemented the Order instead of rewarding them, the Centre scrapped their individual orders. This shows lack of foresightedness and disrespect for the federal structure,” said an edible oil industry official requesting anonimity.

He said increase in edible oil prices are due to global factor and nothing to do with stock limit which the government failed to realise and unnecessarily harassing traders. He cited the mustard prices fall this year to around ₹6,000-6,500/quintal from last year’s ₹8,000/quintal to higher output as farmers had expanded sowing areas.