In 2023, India will consume more edible oils as imports increase and prices fall

In 2023, the edible oil sector grew with record import growth, low import taxes and a scenario of falling domestic prices to moderate consumers.India’s edible oil imports hit an all-time high of 164.66 lakh tonnes (litres) in the oil year 2022-23 (Nov-Oct) compared to 140.29 lakh tonnes (litres) in the same period 2021-22, an increase in 2021-22. 17 cents. BV Mehta, Managing Director of Solvent Extractors Association of India (SEA), told Business Line that in the oil year 2022-23, edible oils will become the third largest import commodity worth around ₹ 1.38 lakh. India imported 145.29 liters in the calendar year 2023 through November, compared with 132.02 liters in 2022, the latest data show.

DOMESTIC PRICES

Controlling the domestic prices of edible oils was one of the main objectives of the government. in the year. In 2023, domestic prices of edible oils returned to the level of 2021-22, which led to an increase in imports.In June, the government lowered the import duty on refined soybean and sunflower oil from 17.5 percent to 12.5 percent. Now the import duty on refined oils is 13.75 percent including taxes. The import duty on major crude oils is 5 percent and the effective duty is 5.5 percent inclusive of taxes. The purpose of this government action was to keep the price of edible oils under control. On December 20, the retail price of sunflower oil fell 25.5 percent year on year, while prices of other oils such as mustard oil, soybean oil and palm oil fell 18.2 percent, 17.9 percent. 13.7 percent, respectively.

IMPORT PRICES

The import prices of cooking oil decreased significantly in 2023. The CIF import price of RBD palm olein fell from $982 / t in January to $876 / t in November and the CPO price fell to $897 / t in January from $ 997 / t. /ton. tons in November. The import price of soybean oil fell from $1,285 per ton in January to $1,068 per ton in November, while the crude price of sunflower oil fell from $1,295 in January and $979 per ton in November.

GROWTH IN CONSUMPTION

These factors also led to an increase in per capita consumption of edible oils by at least a kilogram in 2023. To this, Mehta said, “Earlier we used to consume around 16.5-16.75 kg of edible oil per year. Now it is around 17.5 kg. The main reasons for this are lower oil prices and rising per capita income of consumers.

PRODUCTION

in India increased year by year both oilseeds and edible oil production. According to KSH, the salable surplus of oilseeds in the oil year 2022-23 was 267.63 liters and edible oil was 75.19 liters. In 2021-22, the salable oil was 267.63 litres, surplus of oilseeds was 243.96 liters and the availability of edible oil was 70.86 litres. 4,444 4,444 The government’s first preliminary estimates of major kharif crop production in 2023-24 estimate oilseed production at 215.33 litres, while 2022-23 is the final estimate for the year at 261.50 litres.Soybean crop production was estimated at 115.28 liters this year (149.85 liters in the final estimate for 2022-2023). 

According to the first preliminary estimates, the kharif groundnut crop is estimated at 78.29 liters (85.62 litres).The recent SEA crop survey, however, estimated Gujarat’s groundnut crop at 33.4 liters compared to last year’s 30 litres, despite a 74,000 hectare reduction in cultivated area.2024 is shaping up to be another crucial year for the Indian edible oil sector. Balancing the need for balanced edible oils with the goal of protecting domestic refiners and long-term self-sufficiency requires careful policy adjustment and a focus on domestic production..

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