Strongly criticizing the government's decision to permit licences for import of palmolien, the Solvent Extractors Association of India (SEA) has said that this move has the potential of destroying the palm refining oil in the country.
Strongly criticizing the government’s decision to permit licences for import of palmolien, the Solvent Extractors Association of India (SEA) has said that this move has the potential of destroying the palm refining oil in the country. In a statement, Atul Chaturvedi, president, SEA, stated that in the last one-and-a-half month, edible oil prices in the international market, as well as the domestic market, are showing downward trend and there is no shortage of refined palmolein or edible oils in the country. “It is most surprising that just one month back, to check the excessive import of RBD palmolein in the country, the government moved import of RBD palmolein from ‘freely allowed’ to restricted item,” he said.
With a massive mustard crop ready for harvesting, the import will have a great dampening effect on prices of domestic oil seeds. This may result in mustard selling below MSP and once again Nafed getting saddled with huge stocks, he warned. “Currently, in Indonesia, RBD palmolein is cheaper than CPO and with higher levy on CPO at $50 and lower duty on RBD palmolein at $30. Indonesia has great advantage to push the export of RBD palmoelin into India,” he said.
Further, India’s duty difference between CPO and RBD palmolein being only 7.5% will open the flood gates for import of RBD palmolein as we have seen last year during January to September 2019 when the duty difference was just 5% for import from Malaysia, Chaturvedi said. This will also will have serious impact on domestic refining industry and capacity utilisations will go down, he added.
The association has appealed to the commerce ministry to stop issuing further licences and also review the rationale for issuing such licences which are at variance with the country’s state. India has issued import licences for 1.1 million tonne of refined palmolein from Indonesia, as per market reports. During April-December, India imported about 23 lakh tonne of refined palm oil – about 2.5 lakh tonne every month.