Edible Oil Prices

General Studies-3

Topics Covered: Major crops cropping patterns in various parts of the country.

Context: Edible oil prices are likely to reduce by December as international commodity futures show a declining trend and the production of domestic oilseed crops.

Recent Rise in the prices of Edible Oil:

• Last year, the retail prices of six edible oils — groundnut, mustard, vanaspati, soya, sunflower, and palm oil had risen up to 48%. This was due to
  • Surge in global prices, and lower domestic production of soybean which is India’s largest oilseed crop.
  • Excessive buying of edible oil by China.
  • Many major oil producers are aggressively pursuing biofuel policies and diverting their edible oil crops for that purpose.
  • Governmental taxes and duties also make up a major chunk of the retail price of edible oils in India.

India’s Dependence on Edible Oil:

• India is the world’s biggest vegetable oil importer.
• India imports about 60% of its edible oil needs, leaving the country’s retail prices vulnerable to international pressures.
• It imports palm oil from Indonesia and Malaysia, soyoil from Brazil and Argentina, and sunflower oil, mainly from Russia and Ukraine.

Facts about Edible Oils:

• Primary sources of Edible oil (Soybean, Rapeseed & Mustard, Groundnut, Sunflower, Safflower & Niger) and secondary sources of Edible Oil (Oil palm, Coconut, Rice Bran, Cotton seeds & Tree Borne Oilseeds).
• In India major challenges in oilseed production is
  • Growing in largely rain-fed conditions (around 70% area),
  • high seed cost (Groundnut and Soybean),
  • small holding with limited resources,
  • low seed replacement rate and low productivity.

Recently the Government announced the National Edible Oil Mission-Oil Palm (NMEO-OP) to boost domestic oilseed production and make the country self-sufficient in cooking oils.

InstaLinks:

Prelims Link:

1. About Edible oil
2. Primary and Secondary sources of Edible oil
3. Major edible oil importing countries
4. About National Edible Oil Mission-Oil Palm (NMEO-OP) and its provisions

Mains Link:

Why does India have to import edible oils? What is the burden of importing edible oils on the government’s exchequer? What can we do to boost the domestic production of edible oils? Elaborate.

 Source: The Hindu