SEA demands cut in oilseeds import duty to 5-10%

Says overseas sale of oilmeals has almost come to a standstill

Industry body SEA has sought slashing of import duty on oilseeds like mustard to 5-10% from 30% to boost edible oil supplies to local markets and oilmeal crushers.

A sharp decline in domestic oilseeds output and crushing has encouraged edible oil imports, while discouraging exports of oilmeal, it said.

In fact, export of oilmeal -- used as animal feed -- has dropped by 85% to 59,818 tonnes in December 2015, as against 4,10,178 tonnes in the year-ago period, it added.

"The Association has pleaded with the central government for reducing the import duty to 5-10% from the current 30% on high oil content oilseeds like rapeseed/mustard and sunflower seed," Mumbai-based Solvent Extractors' Association of India (SEA) said in a statement.

The reduction in import duty on oilseeds will reduce import of edible oils, larger availability of oilmeals for local consumption by feed industry and export, it said.

Further, the oilseeds imports will not have any adverse impact on the farmers as they are protected with an assured minimum support price by the government, it added.

Stating that "alarming" decline in oilseeds production and crushing has hit India's oilmeal exports, SEA said the overseas sale of oilmeals has almost come to a "standstill".

As per the latest data, India's oilmeal exports declined by 48% to 9,63,442 tonnes in the April-December of this fiscal from 18,62,283 tonnes in the year ago period.

"Soybean crushing is very much reduced due to continuous disparity and high price of domestic market affecting overall domestic availability of both oils and meals. The capacity utilization is at the lowest," SEA said.

The industry is passing through very tough time and many plants are close down or operating at very low capacity due to disparity in crushing and export, it said.

Consequently, SEA said soyabean meal exports has fallen to 61,556 tonnes in April-December period of this fiscal from 4,44,736 tonnes in the year-ago period.

Export of rapeseed meal has fallen to 3,12,148 tonnes from 8,95,585 tonnes, while the shipment of groundnut meal has dropped to 606 tonnes from 2,244 tonnes in the said period.

However, export of castor seed meal rose marginally to 3,70,522 from 3,30,082 and ricebran extraction shipments increased to 2,18,610 tonnes from 1,89,636 in the said period.

India exports oilmeal to countries including South Korea, Thailand, Vietnam, Taiwan, Indonesia, Iran and European nations.