Agri Business

Solvent Extractors' body demands allowing bulk export of mustard oil

Our Bureau Ahmedabad | Updated on May 29, 2019 Published on May 29, 2019

The oil trade body, Solvent Extractors' Association of India (SEA) on Wednesday reiterated their demand for allowing bulk export of rape/mustard oil.

The Association has sent a memorandum to Ministry of Commerce and Ministry of Consumer Affairs, Food & Public Distribution and Ministry of Agriculture & Farmer’s Welfare, requesting them to allow exports of rapeseed oil/mustard oil in bulk quantity to support the price level of mustard seed and thereby farmers.

A memorandum was sent to Directorate General of Foreign Trade (DGFT) on Tuesday, May 28, raising concerns on the record production and a possible losses to the farmers if the exports in bulk are not allowed.

Record production

"This year we have record production for rapeseed to the tune of about 85 lakh tonnes, which has put tremendous pressure on prices of mustard seed and the farmers are realising RS 3,500 to Rs 3,600 a quintal (basis 42 per cent oil), against the Minimum Support Price (MSP) of Rs 4,200 a quintal. The exports of mustard oil in bulk, may not be in the large quantity but it will definitely impact the market sentiment and support the price levels," said a letter written by Atul Chaturvedi, President, SEA.

As per the data compiled by SEA, for the year April 2017 to March 2018, India exported 3266 tonnes of mustard oil, while during April 2018-March 2019, India exported about 3,559 tonnes of mustard oil. Unlike other vegetable oils, Mustard oils have larger market in the United States, UAE, UK, Nepal, Canada, Bhutan among others.

Currently, in the vegetable oil sector, only the rapeseed oil/mustard oil is subjected to the condition of maximum pack size of 5 kg for export. All other vegetable oils are permitted to be freely exported irrespective of the pack size. This year, the mustard seed crop is likely to be highest since 2010-11 (approx 82 lakh tonnes). In the meantime, the rapeseed-mustard production had dipped to lowest levels of about 63 lakh tonnes in 2014-15.

In March last year, the Cabinet Committee on Economic Affairs, had opened export of all varieties of edible oils except mustard oil. Mustard oil continued to be exported in consumer packs of up to 5 kgs, with a minimum export price (MEP) of $ 900 per tonne. In his letter, Chaturvedi requested removal of restrictions on exports stating that the "Agri Export Policy 2019 aims to remove all the earlier export restrictions on all the agri products."

Published on May 29, 2019

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