Edible Oils On Up-Move Post Duty Hike; May Advance Further In Near Term

MUMBAI, 21 Sep (Commoditiescontrol): The recent increase in import duty on crude edible oils, such as soybean, sunflower, and palm oil has sent their retail prices higher across the country. The duty hike coincides with festival linked buying activity, which has sparked concerns among consumers and traders, both.

The increase in import duty on edible oils, is effective since September 13. The duty on crude palm, soybean, and sunflower oils is increased to 20%, and on refined oils to 32.5%. This strategic move supports domestic producers and incorporates an agricultural infrastructure tax.

The government engaged with various industry body advising them to ensure MRP of each oil is maintained till availability of edible oil stock imported at 0% and 12.5% basic duty. Since, India highly relies on edible oil imports, preventing a price rise will be tough challenge.

It will be interesting to know how far the prices can run in the current scenario. Below are the technical chart of each variety and their future prospect. Prices have already moved higher in expectation of festival led demand and are likely to strengthen further as suggested by the chart below.

Sunflower Crude Oil - crude, currently quoting at Rs 1,125 for 10kg, is not far from its first resistance level placed at Rs 1,175. Once this level is crossed the price may make an attempt to reach Rs 1,475 level.

Sunflower Oil Refined - is on the up-move and quotes near nine-month high. It is likely to maintain its upward momentum, and likely to meet resistance near Rs 1,465 and Rs 1,665.

RBD Palmolien prices have gathered momentum in recent times and reached Rs 1,175 per 10kg on Friday. More upside may lie ahead and prices can reach to Rs 1,416 level. Technical recommends buy on decline.

Rice Bran Refined Oil - has scaled above key level. It closed last session at Rs 1,210. Now it will try to scale towards Rs 1,300 and later on Rs 1,465 level. However, the chart shows price near its resistance level.

Soy Refined Oil - has spurted after the increase in import duty. A steep rise is observed and is likely to push prices towards first resistance level of Rs 1,234.

Mustard Oil Expeller - remained in upward direction. Prices have breached Rs 1,400 level and now appears to scale towards Rs 1,485.

Cotton Wash Oil - has surged to Rs 1,230 level for 10kg and poised to make further gains. It has broken out of Rs 950 and look set to meet resistance level of Rs 1,375.

Bellow are the technical chart for each oil variety. The same will provide further insight into likely price movement and expected price level to reach in the near term.

(By Commoditiescontrol Bureau; +91 98201 30172)