Govt extends stock limits on edible oils till December

The Centre has decided to extend stock holding limit order on edible oils and oilseeds until December 31, this year, effectively putting curbs in place during the rabi harvest as well as the next main kharif harvesting period.

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. 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.

“When the validity of the stock limit was until June 30, the current order extending it until December shows the government’s intention to keep prices under check even for the kharif crops and probably it wants to convey the message to farmers before sowing,” said an edible oil industry official.

Groundnut and soyabean are two major kharif oilseed crops in the country and their prices are quite high compared to a year ago, though in sync with global prices of cooking oils.

There is no change in the quantitative restrictions imposed earlier. For edible oils, the stock limit would be 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 10 tonnes for retailers and 200 tonnes for wholesalers. It will be 90 days of “production capacity” for processors based on their daily processing.

Exporters and importers have been kept outside the purview of the stock limit order with some caveats, the ministry said in the notification issued March 30.

An exporter, if able to demonstrate that the whole or part of his stock in respect of edible oils and edible oilseeds are meant for exports, only the stock meant for export will be exempted. An importer, if able to demonstrate that the stock in question is sourced from imports, will be outside the purview of the stock limit.

According to government estimates, country’s oilseeds production for 2021-22 crop year (July-June) is likely to be 37.15 million tonnes (mt), up by 3.3 per cent from year-ago. Soyabean output has been pegged at 13.12 mt, mustard at 11.46 mt and groundnut at 9.86 mt.

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