Oil Palm Developers and Processors' Association president Sanjay Goenka told The Financial Express that edible oil prices have crashed from a high of Rs 34,000 per tonne in November last year to around Rs 18,000 per tonne in the international market.

Simultaneously the government has reduced the import duty on edible oils from 65 per cent to the current rate of 15 per cent, Goenka said. India has contracted imports to the tune of 14 lakh tonnes of edible oils for the current fiscal.

Argentina, Brazil and Malaysia, which are the major soft oil producing countries have seen devaluation of their currencies and thanks to a bumper crop in the Malaysia, edible oil prices have crashed to rock bottomlevels.

Goenka said as adding to the industry's woes, as per state government regulations, oil palm processing units have to purchase fresh fruit bunches from the farmers at the rates fixed by the government from time to time. Currently, the government fixed rate is Rs 3,000 per tonne. Oil palm processing units are now facing a scenario of falling international prices, low import duties and high procurement prices of fruit bunches.

Goenka pleaded for subsidising the procurement price of fruit bunches rather than seeking a lower procurement price as it would prove to be unremunerative to the farmers thus killing the nascent industry Goenka said oil palm cultivation held tremendous potential in the state.

During the current financial year, the total fruit output from the state will be in the region of 70,000 tonnes, which translates to an oil output of 1500 tonnes. This, he said, marks a growth of 50 per cent from that of the previous year, he added. In terms of area expansion, he said around 5000hectares of land have been brought under oil palm cultivation during the current financial year.