SEA seeks higher import duty on refined oil

Solvent Extractors' Association of India (SEA) today pitched for raising import duty on refined palmolein oil in order to discourage its cheap import and safeguard the interest of domestic refineries.
"We are demanding from the Centre to increase import duty on RBD Palmolein oil in order prevent cheap import of refined oil into the country which has made a significant dent on domestic refined oil producing facilities," SEA Executive Director B V Mehta told reporters here today.
Currently, import duty on crude palm oil (CPO) stands at 2.5 per cent while duty on RBD Palmolein oil is 7.5 per cent.

"We have sought from the government to have duty differential of at least 10 per cent between these two items which will help in protecting the domestic vegetable oil refiners," Mehta said.
The Centre this year levied import duty of 2.5 per cent on CPO from zero per cent which reduced the duty differential between CPO and RBD palmolein oil to 5 per cent.
The apex body for edible oil industry further expressed concern over the inverted duty structure adopted by Indonesia and Malaysia, largest suppliers of RBD and CPO, whereby it has become now cheaper to import refined oil than crude palm oil.

Mehta said Indonesia and Malaysia have imposed 12 per cent export duty on CPO and has kept 5 per cent duty on refined oil.

SEA apprehends that the import of refined oil would surge to 30 lakh tonne in 2013-14 (November-October) period if Centre does not take concrete step in this regard.
Mehta pointed out that refined oil import ito country jumped by 41 per cent to 22.23 lakh tonnes in 2012-13 period as against 15.77 lakh tonnes in corresponding period.
Cheap import of refined oil has hit the domestic vegetable oil producing industry hard with capacity utilisation of this sector dropping to 30-40 per cent.

"We have installed capacity of 20 million tonnes of vegetable oil In the country and its utilisation capacity has slipped from 60 per cent to 30-40 per cent due to cheap imports," he claimed.
On edible oil import front, Mehta said the country is likely to import 110 lakh tonne of edible oil in 2013-14 (November-October) as agianst 100 lakh tonnes imported in corresponding period.