In a bid to keep a close watch on the daily movement of retail and wholesale prices of a few essential commodities, especially edible oils, the government has started to collect price information from the market, along with data on region-specific consumption patterns. The data will be used for taking swift policy decisions aimed at minimising the adverse impact of high prices on consumers.
As the edible oil consumption pattern varies across regions, the Department of Consumer Affairs (DoCA) has started to give weight to prices of specific edible oils in select regions to arrive at daily national average prices. The rationale is that this method helps the department in understanding the impact of prices on consumers more accurately.
The DoCA collects daily price data of 22 essential food commodities including six edible oils — palm, groundnut, mustard, vanaspati, soya and sunflower — from 179 centres across the country. The department also collects daily prices of pulses, sugar, rice, wheat, tea, salt, milk and vegetables such as tomato, onion and potato.
Earlier, the DoCA used to follow a system of simple averages for arriving at the national average price of edible oils.
“We realised that the simple national average of prices for edible oils does not clearly reflect the real price movement,” Rohit Kumar Singh, secretary, DoCA, told FE.
The department has also started to collect prices of branded edible oil across centres. For instance, mustard oil is mostly consumed in eastern and northern states while the consumption basket is small in the southern states. Groundnut oil is largely consumed in states such as Gujarat and Maharashtra.
The government is working on following similar weightage of other commodities such as milk, wheat and rice.
In a bid to keep a close watch on price trends of essential commodities, the government has been taking measures to monitor price movement closely, which help in taking prompt measures to curb price rises.
On February 4, 2022, the government had extended stockholding limits for edible oils and oilseeds till June 30, 2022 while specifying the quantity of stocks retailers, wholesalers and processors can hold. In October 2021, the government had imposed stockholding limits on edible oils and oilseeds till March 31, 2022. However, the quantities of stock limits of edible oils and oilseeds were left to the state and Union territories to decide on the basis of their respective consumption pattern.
India imports about 55% of its total domestic requirement of edible oil. India mainly produces groundnut, mustard, coconut and soyabean varieties of edible oil.
Crude palm and soybean oil are imported mainly from Malaysia, Indonesia, Argentina and Brazil, and these items had shares of 62% and 21% in the total edible oil imports, respectively.
India depends on Ukraine for sunflower oil, which had a 14% share in the total edible oil import basket in 2020-21.
According to estimates made by traders before the Russian invasion of Ukraine, edible oil imports were to jump 28% on year to Rs 1.5 lakh crore in 2021-22. In 2020-21, these imports had surged by 44%.
