No export duty to spur investment in rice bran solvent extraction

Encouraged by the withdrawal of a 10 per cent export duty on de-oiled rice bran oil cake (Dorboc), solvent extraction units in India are likely to see an investment of Rs 300 crore in the next couple of years, feel experts.

India's annual paddy production is estimated at 120 million tonnes. With an estimated average recovery of around six per cent, the rice bran (a brown layer between husk and rice) obtained through processing of this paddy is about 7.2 mt. Of this, however, solvent extraction units have managed to process only five mt, to obtain around 0.9 mt of rice bran oil. The remaining four-odd mt goes to make Dorboc.

"The withdrawal of export duty would make us competitive in the international market, where Dorboc is competing with wheat husk and other materials used for bird and animal feed," said B V Mehta, executive director, Solvent Extractors' Association of India.

Used as fodder, Dorboc is exported largely to Vietnam. Currently, our Dorboc export is estimated at 200,000 tonnes annually, worth around Rs 200 crore.

Though exports are hardly five per cent of overall production, yet it makes sense for many extraction units, since high transportation cost makes it expensive to supply to the major domestic consuming centres in South Indian states. Export to Vietnam gives a better return, said an expert.

"We are promoting rice bran oil as healthy for the last few years, which means new production units would continue to be set up," said Mehta, noting the spurt in investment over recent years.