With the reduction in customs duty rates, olive oil price may come down by nearly 15% in the next few days on imported stocks provided that international prices remain stable.
The government has reduced customs duty levied on all grades of olive oil to 7.5% from the previous rates of 45% on virgin olive oil and 40% each on refined olive oil and olive pomace oil. Fall in price of olive oil is subject to exchange rates remaining stable. In fact, much of the benefit of the duty reduction has been wiped out due to the recent appreciation of the euro, industry sources said.
“Previously, olive oil was always overlooked and, due to the high rate of import duty, its consumption was restricted to high-end consumers as the average consumer found it too expensive. Olive oil is not the rich man’s food; it is the healthy man’s food. With price reduction, consumption will increase and there will be a significant improvement in national health,” said VN Dalmia, president of IOA. The association is the national apex association of olive and olive oil producers, growers, distributors, importers, users and consumers. It was registered in July 2007.
The olive oil market in India is expanding rapidly. In 2007, India imported 2300 tonne of olive oil. It is estimated that India will import 25,000 tonne in 2010 and 42,000 tonne in 2012, implying a compounded annual growth rate of approximately 80%.