​​​
  1. Food ministry seeks WPI revision

Food ministry seeks WPI revision

In a bid to align current edible oil consumption and price trends with the wholesale price index (WPI), the food ministry has recommended revision of the weightage given to various oils within the index.

By: | Updated: February 9, 2016 1:28 AM

In a bid to align current edible oil consumption and price trends with the wholesale price index (WPI), the food ministry has recommended revision of the weightage given to various oils within the index.

Sources told FE that the ministry has asked for higher weightage to be given to vanaspati instead of palm oil under the existing WPI series with 2004-05 as the base year. As per the data by the Solvent Extractors Association of India (SEAI), out of the total edible oil consumption of around 203 lakh tonne in 2014-15, vanaspati consumption was only about 8 lakh tonne while the palm oil consumption was 90 lakh tonne.

However, based on WPI of 2004-05, the percentage weightage for vanaspati in the vegetable oil basket is 23% of the total weightage assigned to edible oil. Palm oil accounts for 13.8% of total edible oil weightage. Similarly weightage given to other edible oils in WPI has not changed since 2004-05.

WPI

The sources said that the WPI is at present not reflecting current pattern of consumption and price of vegetable oils. So the food ministry has asked Department of Industrial Policy Promotion (DIPP) to make revisions due to change in consumer pattern.

Officials said during 2004-05, the consumption of refined oils — soyabean, palm, etc — was minimum due to less acceptance amongst consumers, while vanaspati was an accepted cooking medium. “WPI was compiled taking into consideration the prices and consumption pattern at that time,” a source said. SEAI had earlier urged the government to change WPI weightage of edible oil keeping in mind changes in consumption pattern and prices in the past 10 years.

According to SEAI, down the years, the consumption pattern of edible oils has changed. “The consumption of oils such as palm and soyabean oils has increased considerably while the consumption of vanaspati has more or less remained the same,” SEAI has noted.

The trade body has also noted that at present prices of groundnut oil, mustard oil and coconut oil are on

the higher side while the price of palmolein, vanaspati and cotton seed oil are on the lower side. “Thus weightage given to various oils need to be revised so as to align with current prices and consumption so that WPI may be more representative,” SEAI said.

The present WPI series takes 2004-05 as the base year and has 676 items in the commodity basket. Edible oil falls under the classification of ‘manufactured products’.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

  1. No Comments.

Go to Top