India. Oil traders want lower sunflower oilseeds duty


The edible oil trade will request the government to allow local crushing plants to import sunflower oilseeds at considerably lower duty than currently levied to partly meet the country's rising edible oil needs.

The logic for oilseeds imports, hitherto dissuaded by high duty to protect the farmer, is negligible production of sunflower seeds by them and high oil recovery of 40 per cent versus 18-19 per cent derived from soyabean crushing and 11-12 per cent from cottonseed.

Local crushing plants could raise their low capacity utilisation by this measure and become financially viable. Sunflower also has no GM-related issues, making it non-controversial, unlike other oilseeds like soyabean.

"It's a win-win for everybody," said Atul Chaturvedi, president, Solvent Extractors' Association (SEA) and a well respected industry hand. "To allay concern, if any, we will also propose that the seeds could be imported in off season months only."

SEA though proposing import of rape mustard seed is hopeful the government will agree to reduce import duty on sunflower oilseeds as a first to 510 per cent from 31.2 per cent currently. The proposal could be sent as early as Monday.

However, agri expert Vijay Sardana believes that imports of oilseeds is at best a stop gap measure and not a long term solution to address the shortage of oilseeds production. "We had the experience of raw sugar and edible oil imports having a rather unfavourable impact on farmers and the local industry. A few years ago after allowing raw sugar imports, sugar prices plunged here, hurting the farmer. Then again imports of refined palm oils caused the local crushing units to become financially unviable. Rather, as in the case of sugar cane, oilseeds catchment areas should be created with government assistance where oil mills could source seed from farmers who could be induced to raise productivity," said Sardana.

The country on average produces an estimated 25-26 million tonnes of oilseeds, out of which it derives 7-7.5 million tonnes of vegetable oil. That's woefully short of the 22.5-23 million tonnes consumed, trade estimates.


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