SEA questions merits of edible oil export ban

Solvent Extractors' Association (SEA) today questioned the merits of holding back edible oil exports while allowing raw material and by products exports.

"The oilseeds (raw material) and oilmeals (by products) are freely exportable. There is no justification or logic to restrict export of edible oils," SEA said in a statement.

In view of the demand-supply gap, the government had banned bulk export in early 2008, but shipment in consumer packs up to five kg totaling 10,000 tonnes per annum is still allowed to meet the demand of Indians staying abroad.

The ceiling for the current oil year, ending October, has already been exhausted and as such, no quantity is available for export during the next three months.

"We have requested Food, Consumer Affairs and Commerce Ministries to review the policy for export of edible oil both in consumer pack and in bulk as the condition in which the ban was imposed no longer exists," SEA said. 

The export of edible oil, if freely allowed, is unlikely to increase more than 50,000 to 60,000 tonnes per annum, which is hardly 0.35 per cent of India's total consumption of 145 lakh tonnes, it said.   

"This is a very meager quantity and will not have any impact on the domestic supply position. However, this would help the domestic industry to recapture the lost export market," it added.

The move would also give a better signal to the farmers during the current sowing season and shall check the falling price of oilseeds, if any, during harvesting.

As a result of huge and growing demand-supply mismatch, India has to depend heavily on imports to meet over 50 per cent of domestic edible oil requirements, which is likely to be nine million tonnes in 2009-10.

The country is estimated to produce 26.32 million tonnes of oilseeds in 2009-10 against the projected demand of 49.35 million tonnes.