Price band for sensitive goods likely

The state government has decided to put sensitive commodities in a price band. An emergency meeting was held in Gandhinagar yesterday to come up with a strategy to arrest edible groundnut oil prices shooting through the roof.

The spurt in the prices after they touched a high of Rs 970 per 10 kg on Wednesday caused a serious concern. With an eye on the state assembly polls in 2007, the Wednesday meeting at Gandhinagar Secretariat focused mainly on policies and methods to curb the spiralling of edible oil prices.

"State ministers in charge of agriculture, civil supplies and finance "� Bhupendrasinh Chudasama, Chatrasinh Mori and Vajubhai Vala respectively "� met to brainstorm and come up with policies and procedures to curb the spiralling edible groundnut oil prices," some officials said.

However, none of the state's edible oil millers reportedly got any invitation from the state government to discuss the situation, including the factors responsible for the flaring of prices, sources said.

Ukabhai Patel, president of Saurashtra Oil Millers Association (Soma), said, "We don't have any idea. Nor have we been invited "� verbally or in writing "� to attend any such discussion session at Gandhinagar." Patel said, "Prices are flaring as excessive cultivation of cotton has damaged the cultivation pattern of groundnuts. Now, supplies of edible oilseeds are just minuscule compared with the requirement of crushing and producing edible oil. So prices are flaring on huge demand against poor supplies."

Nowadays a majority of harvested crop "� mainly HPS (hand-picked seeds) "� was either booked for exports or for raw consumption, leaving only low-grade raw materials to be availed for crushing processing, he said.

And this resulted in lower production compared with the quantum that can be produced from good quality edible oilseeds, Patel added.

The pricing pattern of crop has undergone serious fluctuations because of scarcity of groundnuts, and this compelled a majority of operators to shut down their processing units.

At least 500 edible oil mills, of a total of 650 located across the Saurashtra-Kutch region, have shut down their business. This has played a key role in pushing up edible oil prices.

Soma in its 57th annual general meeting estimated 16 lakh million tonne (mt) of groundnuts, but the current situation suggested that this projection would prove wrong.

National groundnut output "� mainly from Andhra Pradesh, Karnataka, Rajasthan, Tamil Nadu, Maharashtra and Gujarat "� was estimated to be around 40 lakh mt.