Trade At NMCEIL
 SALIENT FEATURES OF INDIAN EDIBLE OILS SECTOR
1. Demand increasing primarily due to population growth & income increase
2. Domestic production of oilseeds/oils is not adequate to meet the demand
3. Lower yield
4. Fluctuating production of oilseeds
5. Low capacity utilization of processing units
6. Obsolete technology/processing inefficiency
7. High import dependence about 40%
8. Speculative nature of trade

 
 
PRODUCTION OF DIFFERENT OILSEEDS/OILS
(A) Primary Source                                                                       In lakh MTs
Name of Oilseeds                                                         1999-2000         2000-2001
  Oilseeds Oils Oilseeds Oils
Groundnut 53.10 12.22 62.23 14.31
Rapeseed & Mustard 56.60 18.47 42.07 13.04
Soyabean 67.90 10.87 52.73 8.44
Sunflower 8.00 2.64 7.33 2.42
Sesame 5.10 1.61 5.87 1.82
Nigerseed 1.50 0.45 1.15 0.35
Safflower 2.80 0.83 2.01 0.60
Castor 7.80 3.11 8.67 3.47
Linseed 2.90 0.87 1.94 0.58
TOTAL 208.70 51.07 184.00 45.04
 
(B) Secondary Source                                                             In lakh Mts
Name of Oilseeds
  Oilseeds Oils Oilseeds Oils
Coconut 4.50 5.60
Cottonseed 5.00 4.60
Rice-bran   5.00   4.80
Solvent Extracted Oils   2.50   2.00
Tree & Forest Origin   1.00   1.00
Sub-Total   18.00 18.00
Total (A)+(B)   69.07   63.04
(C) Less : Export & Industrial use.   8.00   8.00
(D) Net Domestic Availability of Edible Oils   61.07   55.04
          

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PRODUCTION AND IMPORT OF EDIBLE OILS
                                                                                                    In lakh Mts
Oil Year Production Net availability Imports Total
(Nov.-Oct.) of oilseeds of edible oils   avaiability
    from domestic    
    sources    
1996-97 243.80 70.90 14.16 85.06
1997-98 213.20 60.32 12.66 72.98
1998-99 247.48 69.61 26.22 95.83
1999-00 207.15 60.14 41.96 102.10
2000-01 184.00 55.04 39.75 94.79
2001-02(E) 211.60 63.00 21.45* 84.45**
         

 * Source : SEA of India  ** While availability from domestic source is projected for the whole year, import may go up to about 40.00 lakh tonnes for the whole year & the total availability may be 103.00 lakh tonnes.

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MINIMUM SUPPORT PRICE (MPS) OF OILSEEDS
                                                                                                     Rs.per quintal
  1999-2000 2000-2001 2001-2002
Groundnut(in shell) 1155 1220 1340
Sunflower seed 1155 1170 1185
Sesame seed 1205 1300 1400
Rapeseed/Mustard seed 1000 1200 1300
Safflower/kardi 990 1100 1300
Copra(milling) 3100 3250 3300
Copra(ball) 3325 3550 3350
Soyabean (black) 755 775 795
Soyabean(yellow) 845 865 885
Nigerseed 915 1025 1100
        
 Source : Ministry of Agriculture

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STATUS OF VEGETABLE OIL INDUSTRY
Type of vegetable No. of Annual Capacity Capacity
oil industry units (Lakh Mts) Utilization
Oilseed Crushing units 1,50,000     425(in terms of seeds)     10-30%
Solvent Extraction Units 742 356(in terms of oil bearing material)  46%
Refineries attached with Vanaspati units 100 18(in terms of oil)  30%
Refineries attached with Solvent 300 25(in terms of oil)  35%
Extraction Plants      
Vanaspati units 230 59(in terms of veg. Oil prod)  41%
       
  
  
 
PRODUCTION BY VANASPATI UNITS
                                                                                                    Quantity in MTs
Oil Year Vansapati Bakery Margarine Total
(Nov.-Oct.)   shortening     
1997-98 9,25,564 81,407 4,770 10,11,741
1998-99 12,49,924 84,972 9,003 13,43,899
1999-2000 11,90,793 71,807 9,147 12,71,747
2000-2001 13,60,815 68,685 12,364 14,41,864
2001-2002 5,02,072 17,156 1,870 5,21,098
(Nov-Mar)        
           

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PRODUCTION BY SOLVENT EXTRACTED OILS UNITS
                                                                                              Quantity in lakh Mts
Oil Year S.E.Oil S.E.Oil (non-Edible Grade) TOTAL
1997-98 15.48 2.26 17.74
1998-99 14.59 2.26 16.86
1999-2000 14.06 2.35 16.41
2000-2001 13.48 3.14 16.63
2001-2002 7.77 1.42 9.19
(Nov-Mar)      
         
 
 
YIELD VIS-A-VIS WORLD AVERAGE/HIGHEST YIELD IN THE WORLD : 2000-01
Oilseed India World Highest Counrty
    Average yield  
Groundnut 0.58 1.01 2.08 China
Rapeseed 0.75 1.51 2.98 EU-15
Sunflower 0.64 1.17 1.73 EU-15
Cottonseed 0.59 1.06 2.11 Australia
Soyabean 0.86 2.31 3.34 EU-15
         

Source : Oil World : March 2002
          

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FLUCTUATIONS IN OILSEEDS PRODUCTION
  • In 1998-99 production of oilseeds had reached the highest level so far of 247.48 lakh tonnes
  • In 1999-2000 the production declined to 207.15 lakh tonnes which further declined to 184.00 lakh tonnes in 2000-2001
  • In 2001-2002, the estimated production is of 211.60 lakh tonnes
 
 
MAIN REASONS FOR FLUCTUATIONS IN PRODUCTION
  
  • Decline in area under cultivation - declined from 26.23 million hectares in 1998-99 to 24.28 million hectares in 1999-2000, 23.25 million hectares in 2000-01. In 2001-2002, area is marginally increased to 23.32 million hectares
  • Decline in Yield : From 944 Kgs/hectare in 1998-99 yield has declined to 853 kgs in 1999-2000, 791 kgs in 2000-2001. In 2001-2002, however, there is an improvement : 907 kgs/hectare
  • Inadequate irrigation/effect of drought : Only about 24% to 26% of the area is under irrigation
  • Lack of Hybrid/HYV seeds
  • Susceptibility of oilseeds to pests & diseases
  

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REASONS FOR LOW CAPACITY UTILIZATION
  1. Unrestricted growth in the industry consequent upon de-licensing of the vegetable oil industry
  1. Creation of capacity totally incommensurate with availability of raw materials
  1. Obsolete technology
  1. Low margin because of stiff competition, inefficiency of operations, etc.
  1. Speculative nature of the trade.
  1. Mismatch between (low) raw material production and (high) processing capacity leading to a situation of too much capacity chasing too few raw material (oilseeds)
  1. Fragmentation  of capacities, poor scale economies, large idle capacity.
  
 
  
 
 
IMPORT POLICY ON EDIBLE OILS
 Free imports inder OGL except for copra/coconut oil, which is canalized through STC.

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CUSTOMER DUTY STRUCTURE OF EDIBLE OILS
(A) Duty Rate Structure on Vegetable Oils (Refined) of Edible Grade
Item Description WTO Rated of Duty effective from 1.3.2002
  binding Basic  SAD Total duty
    customs duty    
Groundnut Oil 300%   85% 4% 92.4%
Sunflower/saffower 300%   85% 4% 92.4%
Coconut Oil 300%   85% 4% 92.4%
Palm Oil 300%   85% 4% 92.4%
Soyabean Oil 45%   45%  4% 50.8%
RBD Palmolein 300%  85% 4% 92.4%
Rapeseed Oil 75%  75% 4% 78%
Colza of Mustard Oil 75%   75% 4% 78%
Other Oils 120/300%   85% 4% 92.4%
(B) Duty Rate Structure on Vegetable Oils (Crude) of Edible Grade
Item Description WTO Rates of Duty effective from 1.3.2001
  binding

& 30.10.2001
    Basic SAD Total duty
    customs duty    
Palm Oil (for manufacture of vanaspati 300% 65% Nil 65%
Palm Oil (for other than manufacture of vanaspati) 300% 75% Nil 75%
Soyabean Oil 45% 45% Nil 45%
Groundnut Oil 300% 75% Nil 75%
Sunflower/Safflower 300% 75% Nil 75%
Coconut Oil 300% 75% Nil 75%
Rapeseed Oil 75% 75% Nil 75%
Colza or Mustard Oil 75% 75% Nil 75%
Other Oils 120/300% 75% Nil 75%
           

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TARIFF RATE QUOTA (TRQ) AND CUSTOMS DUTY THEREON
  • For crude sunflower oil or safflower oil for import upto an aggregate of 1,50,00 tonnes (TRQ) of total imports in a financial year, the customs' duty is 50%, against 75% for non-TRQ import.
  • Similarly for refined rapeseed/colza or mustard oil for import upto 1,50,000 tonnes (TRQ) of total imports in a financial year, the basic customs' duty is 45% (against 75% for non TRQ import). SAD of 4% is to be added.
  
 
 
IMPORT OF VANASPATI FROM NEPAL UNDER INDIA-NEPAL TRADE TREATY
  • The India-Nepal Trade Treaty has been revised to safeguard the interest of domestic vanaspati manufacturers
  • W.e.f 6.3.2002 a fixed quantity of one lakh MTs of vanaspati are allowed to be imported from Nepal without payment of customs'duty, through 6 designated Land Customs Stations
  • The fixed quota of vanaspati imported from Nepal is canalized through the Central Warehousing Corporation(CWC)
  • W.e.f. 1.3.2002 on import of vanaspati from Nepal SAD @4% is levied.
 

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EXPORT POLICY
AND
EXPORTS
 
 
EXPORT POLICY ON EDIBLE 
OILS/OILSEEDS
  • Export of all oilseeds such as HPS groundnut, sesame seeds, sunflower seeds, mustard seeds when exported for consumption purpose, are free without any quantitative/licensing requirement
  • Free export of vegetable oils.
 

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EXPORT OF OILSEEDS, MINOR OILS AND FATS, AND OILMEALS/EXTRACTION (I)
 
Year 1999-2000   2000-2001
Oilseeds Quantity   2.39   3.22
value 663.6   837.7
Minor Oils & Fats Quantity   2.37   2.32
value 918.6   843.8
Oilcake/extraction Quantity   26.76   23.53
value 1736.9   1711.5
  
                                Source : SEA of India
    
 
 
EXPORT OF OILSEEDS. MINOR OILS AND FATS, AND OILMEALS/EXTRACTION (II)
DGCI & S data on export during April,2001 to February, 2002
Quantity   Value
(in tones) (Rs. In crores)
Sesame seeds 2,26,159   529.6
Groundnut 1,04,585   232.79
Castors oil 2,00,428    588.15
Oilmeals 24,26,245   1962.16
Niger seeds 19,198   42.09
  

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PRICES 
OF
EDIBLE OILS
 
 
 
 
PERCENTAGE VARIATION IN WHOLE SALE PRICE INDEX OF EDIBLE OILS
                                                                                      Quantity in lakh MTs
  Over One Over 4 Over 1
  Year Weeks week
Edible oils (as a group) +18.2 +4.9 +2.5
Rapeseed/Mustard Oil +9.4 +6.7 Steady
Groundnut Oil +6.6 +2.6 +0.3
Coconut Oil +14.7 +4.1 +3.4
Vanasparti +30.1 +3.8 +3.8
        

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WHOLE SALE PRICES OF EDIBLE OILS AT FOUR METROS
                                                                                   Price: Rs. Per quintal
                                                                                   As on : 26.6.2002
  As on One One
  • Groundnut oil
  Delhi 6580 6733 5640
  Mumbai 4600 4450 4350
  Kolkata 5000 5000 5066
  Chennai 4350 4350 3900
  • Mustard Oil
Delhi 4000 3933 3433
Kolkata 4200 3675 3200
  • Vanaspati
Delhi 4467  4333  3267
Mumbai 4333  3733  3233
Kolkata 4400  3833  3200
Chennai 3870  3870  2970
 
                                                                                  As on :  28.6.2002
    As on One One
    28.6.2002 month ago year ago
  • Groundnut oil
        
  Delhi 77.00   74.00 72.00
  Mumbai 48.00   46.00 44.00
  Kolkata 60.00   60.00 70.00
  Chennai 47.00   45.00 N.R.
  • Mustard Oil
        
  Delhi    45.00 40.50 39.00
  Mumbai    60.00 60.00 66.00
  Kolkata   44.00 40.00  36.00
 
                                                                                         As On : 29.6.2002
As on  One One
29.6.2002    month ago  year ago
  • Vanaspati
Delhi   44.00 40.00  33.50
Mumbai   46.00 40.00  34.00
Kolkata    45.00 42.00 31.00
Chennai    44.00 42.00 N.R.
  
Source: Department of consumer Affairs
          

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EDIBLE OILS  
UNDER 
PUBLIC DISTRIBUTION
SYSTEM