NEW DELHI, Sept 26 (Reuters) - Indian edible oil refiners are seeking a steep hike in import duty on edible oils as local oilseed prices have fallen due to a surge in shipments of cheaper palm oil.
Higher import duty on vegetable oils could support local oilseed prices and accelerate crushing of oilseeds like soybean and rapeseed.
“There is an urgent need to support the farmers by increasing import duty on crude vegetable oils from 2.5 percent to 10 percent and refined vegetable oils from 10 percent to 25 percent,” Vijay Data, president of the Solvent Extractors’ Association Of India, said at a global edible oil conference.
India’s overseas purchases of edible oil in the year starting November are set to surge to a record 13 million tonnes from 11.6 million tonnes estimated for the current year.
The surge in edible oil imports in last few months have depressed local oilseed prices. Soybean futures earlier this week hit their lowest levels in 13-months.
“A duty hike is important especially to encourage farmers to grow oilseeds else amid multi-year low prices, there would be large-scale shift next season from oilseeds to other crops,” Dinesh Shahra, managing director of Ruchi Soya Industries Ltd , India’s biggest soybean processor, said.
Nearly 60 percent of India’s annual edible oil demand of 18-19 million tonnes is met by imports, consisting mainly of palm oil sourced from Indonesia and Malaysia.
India also buys tiny amounts of soyoil from Latin America and sunflower oil from the Black Sea region. (Reporting by Rajendra Jadhav; Editing by Krishna N Das)