Indian Agri Ministry asks stakeholders to suggest ways to ensure better prices for oilseed farmers

The Indian Ministry of Agriculture and Farmers’ Welfare has asked various industry stakeholders on how to ensure better prices for oilseed growers, particularly soyabean and groundnut.

The development follows businessline report that palm oil has become costlier than soyabean and sunflower oils due to fears of supply shortage and Indonesia’s plans to raise export taxes and increase palm oil share in biodiesel to 40 per cent. 

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The concern is also because imports of edible oils increased by 38 per cent in November. Solvent Extractors Association of India (SEA) Executive Director BV Mehta told businessline that excess import of soyabean oil has impacted soyabean prices in the domestic market. 

Soya below MSP

“Bean prices are ruling ₹500-600 a quintal below the ₹4,892 minimum support price. Our seeds are not being crushed and imports are increasing,” he said.

Low soyabean prices in the global market are also affecting exports of soyameal with India being outpriced by $50-60 a tonne by competing nations. 

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Sources said the Agriculture Ministry is concerned because the Centre wants oilseed production to increase and has launched the National Mission on Edible Oils – Oilseeds to encourage growers. The objective of the mission is to increase oilseed production to 69.7 million tonnes (mt) by 2030-31 from the current 39 mt.

Hike in import duty

The Centre has increased the minimum support price for oilseeds and increased the duty on the import of edible oils. On September 14, the Centre raised the duty on crude oils such as palm, soya and sunflower to 20 per cent from zero per cent and for refined oils to 32.5 per cent from 12.5 per cent. 

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The effective duty on crude and refined oils is currently 27.5 per cent and 35.75 per cent including agriculture infrastructure and development cess and social welfare surcharge. 

As of December 12, the landed price of crude palm oil was $1280 a tonne, that of RBD palmolein was $1,245, degummed soyabean oil $1,150 and crude sunflower oil $1,235.