After rising in the past few month due to lower production of oilseeds and higher manufacturing and logistics costs, the edible oil prices have started cooling off as branded manufacturers are cutting the rates. Adani Wilmar has now slashed the prices of its edible oils by Rs 10 per litre.
Adani Wilmar has reduced the maximum retail price (MRP) of Fortune refined Sunflower oil’s 1-litre pack to Rs 210 from Rs 220. The MRP of Fortune Soyabean and Fortune Kachi Ghani (mustard oil) 1-litre packs has been reduced to Rs 195 from Rs 205, the company said in a statement on Saturday.
Recently, Gemini Edibles & Fats, a Hyderabad-based company, also cut the maximum retail prices (MRP) of its Freedom Sunflower Oil by Rs 15 to Rs 220 for a one-litre pouch in the past week. The company is also expected to reduce the price further.
Why Edible Oil Prices Are Falling
The companies are reducing the prices on edible oil as central government recently cut import duties on them. The government this week reduced the base import prices of crude palm oil, soyoil, gold and silver.
The new base import price of crude palm oil now stands at $1,620 per tonne as against $1,625 per tonne. Similarly, RBD palm oil and RBD palmolein base prices have also been reduced to $1,757 per tonne and $1,767 per tonne, respectively. The base import price of crude soya oil has been reduced to $1,831 per tonne, compared with $1,866 per tonne. The base prices are used to calculate the amount of tax an importer needs to pay.
“We are passing on the benefit of the reduced cost to our customers, who can now expect purest edible oils made with the highest safety and quality standards, which are also light on their pockets. We are confident the lower prices will also boost demand,” Adani Wilmar MD and CEO Angshu Mallick said.
India’s Edible Oil Imports
The country’s palm oil imports in May dropped 10 per cent as compared to April as top producer Indonesia curbed exports of the edible oil. The Solvent Extractors’ Association (SEA) said India imported 5,14,022 tonnes of palm oil in May, down from 5,72,508 tonnes in April.
India is the world’s largest importer of palm oil and is dependent on Indonesia and Malaysia for its demand. India imports over 13.5 million tonnes of edible oil every year, out of which, 8-8.5 million tonnes (around 63 per cent) is palm oil. Now, nearly 45 per cent comes from Indonesia and the remaining from neighbouring Malaysia. India imports roughly 4 million tonnes of palm oil from Indonesia each year.
Indonesia in April had banned the palm oil exports. The export ban was not applicable to crude palm oil but will only cover refined, bleached, deodorised (RBD) palm olein. After almost a month of announcing the ban, the country lifted the restriction May 23.