JAIPUR (Commoditiescontrol) - In a conversation with commoditiescontrol.com, Mr. Shyam Bajaj, Director of Jaipur-based Shreekant Oils Pvt Ltd, urged the central government to take concrete measures towards making India a self-sufficient nation in edible oils and oilseeds. At the same time, he stressed on the need to curb imports of edible oils to safeguard the domestic industry.
Mr. Bajaj said that in the year 2003, the country was 97% self dependent in edible oil consumption but later government’s apathy and unrestricted imports of edible oil led the country to be just 40% self-dependent.
India’s edible oil consumption for this year is estimated at around 190-195 lakh tonnes annually. To meet this requirement, the country will have to import around 120-125 lakh tonnes. But, if the government controls import in the country or hike the existing duty, dependency on imported edible oil can be lowered. Also, if country’s farmers get higher Minimum Support Price (MSP), high quality seed and subsidy on fertilizers, India can become self-reliant in edible oils.
While affecting the domestic edible oil industry, cheap oils from overseas also propel domestic consumers to buy adulterated edible oils. Blending of cheaper imported oils has made domestic oil industry unviable. Farmers are also forced to shift to other attractive crops as they could not get expected prices for their produce. Given all these factors, the domestic oil industry seems to be incompetent.
On production of new crop of mustard, Mr. Bajaj said that the country does not have any scientific method to assess crop, so it has to depend on traders’ estimations. He said that there are no reports of crop damage from the recent rains and cold weather. Mr. Bajaj has assured that mustard production is not likely to reduce from 65 lakh tonnes. So, crop size will be equal to last year.
He said that most of the traders are of the opinion that mustard production this year could be at 58-62 lakh tonnes. Last season, mustard production in the country was estimated at 75 lakh tonnes but later crop was reduced to large extent due to hailstorms and extreme unfavorable weather conditions. There are no such issues this year and crop damage is highly unlikely.
Commenting on mustard prices, he said that the prices can touch bottom level of Rs. 3,400/100kg on supply pressure by April end, but the commodity will certainly see a surge after that. Big players and stockists will be active in buying.
When it comes to mustard oil prices, Mr. Bajaj feels that the prices may not fall significantly given that India as a leading consumer depends heavily on imports. But at the same time, import of canola oil from Canada is adding to the woes of mustard oil industry. Only export demand will determine any significant movement in mustard meal prices. According to Mr. Bajaj, speculative trading at National Commodity and Derivatives Exchange (NCDEX) is not good for spot market. Government should take immediate steps to restrict speculative trading.
(By Commoditiescontrol Bureau; +91-22-61391533)
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