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Explained: Why are prices of edible oil softening

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Google Oneindia News

New Delhi, June 17: The government on Wednesday said edible oil prices have started falling in the past one month, and the quantum of decline is nearly 20 per cent in some cases.

Stating that India imports a significant quantity of edible oils to meet domestic demand, the Centre said it is working on a "series of mid- and long-term measures" to make the country self-sufficient.

Explained: Why are prices of edible oil softening

"Edible oil prices in India are showing a declining trend across a wide array of oils. As per data from the Department of Consumer Affairs, over the past month, the prices of edible oils are now coming down," an official statement said.

In some cases, the decline is as much as nearly 20 per cent, as shown in prices in Mumbai, it added.
Citing examples, the government said the price of palm oil was ₹ 142 per kg on May 7 and now, it has come down to ₹ 115 per kg, a drop of 19 per cent.

Similarly, the price of sunflower oil has dropped 16 per cent to 157 per kg, from ₹ 188 per kg on May 5.

The price of soya oil was ₹ 162 per kg on May 20 and now, it has come down to ₹ 138 per kg in Mumbai.

"In the case of mustard oil, the price was ₹ 175 per kg on May 16, 2021. Now, it has come down to ₹ 157 per kg, a drop of nearly 10 per cent," the statement said.

Groundnut oil price, which stood at ₹ 190 per kg on May 14, has fallen to ₹ 174 per kg.

The price of Vanaspati has dipped eight per cent to ₹ 141 per kg, from ₹ 154 per kg on May 2.

"Prices of edible oil prices are dependent on a complex set of factors which also include international prices, domestic production.

"As the gap between domestic consumption and production is high, India has to import a significant amount of edible oil," the statement said.

The government said it is working on a series of mid- and long-term measures to resolve the issue on a permanent basis.

"The measures will contribute towards making India Atmanirbhar (self-reliant) in edible oils, which is key ingredient in cooking of food in India," the statement said.

According to data compiled by the Solvent Extractors' Association of India, the overall import of vegetable oils (edible and non-edible oils) during November 2020 to May 2021 is up 9 per cent to 76,77,998 tonnes, compared with 70,61,749 tonnes in the corresponding period of the previous year.

Edible oil year runs from November to October.

India's imports of vegetable oil fell 13 per cent in the oil year 2019-20 to 135.25 lakh tonnes, the lowest in six years, on lower demand of cooking oils from hotels, restaurants and cafeterias.

According to the data, edible oil imports declined to 131.75 lakh tonnes in the oil year 2019-20 from 149.13 lakh tonnes in the previous year. Import of non-edible oils fell 45 per cent to 3,49,172 tonnes, compared with 6,36,159 tonnes a year ago.

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