MUMBAI (Commoditiescontrol) – The premier body, dealing with vegetable oils and oilseed trade in India, the Solvent Extractors' Association of India (SEA) has documented a proposal to the Central Government of India, demanding encouragement of domestic palm plantation, to meet the growing local consumption.
In its pre-budget memorandum, the association has sought promotion of palm plantation domestically, highlighting the various issues related to oilseed production. Demand for vegetable oil is at a record-high, followed by bulky imports, whereas, domestic contribution towards meeting this demand, is almost nil.
Interest in oilseed production has deteriorated in the last two years, since it has become less remunerative compared to other crops. Farmers prefer to grow Chana, coriander, etc. which are less cost-effective and provide higher returns.
The industry is suffering the pinch of raw material shortage and capacity utilization. It is therefore necessary to increase the overall availability of oilseeds and vegetable oils from domestically available resources. Diversification of land from food grains to oilseeds, increasing productivity of oilseeds, encourage oil palm cultivation, place oil palm cultivation under plantation crops and fullest exploitation of non traditional domestic sources are some of the suggested ways which the government can undertake to balance the demand-supply needs, SEA believes.
The association has also proposed to increase the import of oilcakes and rice bran, to reduce the shortage of raw materials, by curtailing the import duty to a reasonable level. In order to achieve these objectives, SEA has suggested the following measures for consideration in Union Budget for 2016-17:
(a) Increase customs duty on import of edible oil to safeguard the interest of farmers
(b) Import of Oilseeds at lower duty to augment raw material supply & implement “Make in India Programme”
(c) Import of oilcakes & rice bran at nil duty to increase overall availability of raw material for crushing and feed industry
(d) Exports of all edible oils in bulk without MEP to support the farmers.
SEA believes that the step towards attracting 100 per cent FDI in Oil Palm Plantation is a welcome move. However, to encourage FDI, it is equally necessary to declare the oil palm as a plantation crop and also the 2.0 million hectares identified suitable for oil palm plantation be exempted from the Land Ceiling Act imposed by various State Governments, SEA added.
With the increasing trend of population and per capita consumption, import of vegetable oils is at its peak. During the oil year 2014-15 (Nov.’14 to Oct.’15) import of vegetable oils i.e. edible oil and non-edible oil has reached a level of 14.61 million tonnes,compared to 11.82 million tonnes, for the same period a year ago, an increase of 23.64 per cent.
The SEA has planned to shortly launch a website to exclusively promote the use and import of Rice Bran oil (RBO), an initiative dedicated to bring together business and consumers for mutual gain.
Meanwhile, the association has noted of sluggish trend in crop sowing during rabi (winter sown) season. It underlined the impact from unusually dry winter in the northern parts. It said, besides leaving little moisture in the soil, it would delay harvesting of paddy and other rabi crops.
Rabi sowing usually starts in late September and early October. The crop is harvested from January onwards. This year, till 13th November, rabi crops had been sown on 12.32 million hectares against 15.93 million hectares, almost 23 per cent less than in the same period last year. The highest shortfall has been in wheat and mustard, the two main rabi crops.
(By Commoditiescontrol Bureau; +91-22-61391523)
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