Ban on rice bran extraction export a retrograde step: SEA

Posted on by

The Solvent Extractors’ Association (SEA) of India has termed the government’s decision to ban the export of de-oiled rice bran a retrograde step.

In a notification dated July 28, the Directorate General of Foreign Trade (DGFT) said, “export of de-oiled rice bran under ITC HS code 2306 and under any other HS code is prohibited till November 30.” With this, export policy of de-oiled rice bran is amended from ‘free’ to ‘prohibited’ with immediate effect up to November 30.

BV Mehta, Executive Director of SEA of India, told businessline that this decision is not based on merits. This decision is a retrograde step, he said.

Stating that this decision will affect the export market for rice bran extraction, he said it will lead to the loss of rice bran export market.

West Bengal, which has a major share in the production of rice bran extraction, has around 30 solvent extraction plants processing rice bran. Though West Bengal is a large producer of rice bran extraction, there is hardly cattle feed industry and demand for it in eastern India.

He said the freight for moving rice bran extraction from eastern India to southern or western India is too high. Therefore, export is the main outlet for disposal of rice bran extraction in eastern India. This will also hit rice milling industry and production of rice bran oil, he said.

Affecting availability

The ban on the export of rice bran will bring down the processing of rice bran. With this, the availability of rice bran oil will reduce. The country will be compelled to import larger quantity of edible oil to that extent, he said.

In a recent memorandum to the government, SEA of India had stated that the main contention of the government to restrict the export of rice bran extraction was that the price of milk and milk products increased substantially due to high fodder prices. Mustard oil cake and rice bran extraction are the major ingredients in this.

In the memorandum submitted to the government, Ajay Jhunjhunwala, President of SEA of India, had said this contention is far from reality.

Explaining this, he said about 25 per cent of de-oiled rice bran (rice bran extraction) is used in the case of cattle feed. Even if the price of de-oiled rice bran is reduced say by 10 per cent, cattle feed value may reduce by 2.5 per cent, and ultimately the milk price will reduce not more than 1 per cent, he said. “There are numerous factors, apart from feed ingredient cost, including packaging, transport etc., responsible for the milk and milk products prices,” he had said in the memorandum.

The country produced 50 lakh tonnes (lt) of de-oiled rice bran in 2022-23. Of this, India exported 6 lt (about 12 per cent).

According to the data available with SEA, India exported 1.25 lt of rice bran extraction in the first quarter of 2023-24 against 1.49 lt in the corresponding period of 2022-23. Of this, Vietnam imported 76,789 tonnes of rice bran extraction from India followed by Bangladesh at 23,158 tonnes.