Agri Business

Govt mulls zero-duty on import of refined oils?

G Chandrashekhar | | Updated on: Jan 25, 2011

OIL_356634a.jpg | Photo Credit: V_Ganesan

The edible oil market is agog with rumours that the Government is seriously considering withdrawing the 7.5 per cent customs duty currently levied on refined oils.

Such a move will have a salutary effect on domestic prices. Currently, refined palmolein is sold at $1,260 a tonne.

With zero-duty, overseas prices may spurt by about $30-40 a tonne. However, large importers and domestic players are more likely to start liquidating their stocks, which will improve availability and lower domestic prices.

Duty-free import of refined oils will facilitate traders, alongside refiners, to import and quickly distribute ready-to-consume cooking oil.

At present, the country's edible oil market is virtually controlled by a handful of large refiners. Duty-free import of refined edible oils is part of Government strategy to contain food inflation.

Published on January 13, 2011
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