The government recently exempted edible oils and oilseeds wholesalers and big chain retailers from stock limit orders because of a significant decline in prices. “The order will come into effect immediately,” said the food and consumer affairs ministry in a statement. A limit order is an order to buy or sell a stock with a limit on the maximum price to be paid or the minimum price to be received, thus calling it a ‘Limit order’.
If an order is filled, it will only be placed at the specified limit price or better. However, there is no guarantee of execution. Due to the rising prices and stock control orders, many wholesalers and big chain retailers were unable to keep varieties/ brands of different edible oils. But now, the retailers & wholesalers will be able to do so. Exemption from stock limit orders will positively affect the oilseed prices positively. The returns get higher for all the oilseed-growing farmers.
The govt had imposed stock limits to check the prices of oils and oilseeds in the first place on October 8, 2021, under which the stock limit quantity was left to be decided by the states, and now has decided to exempt the wholesalers & retailers from the same. The order was imposed for the bulk consumers as well.
Subsequently, the Centre has prescribed uniform stock limits extending the order until June 30 this year. This order was further extended till December 31, 2022. The food and consumer affairs ministry reviewed the stock limits keeping in view the gradual reversal of the price situation of major edible oils. Also, a considerable decline is seen in edible oil prices in the domestic as well as international markets.
“A need was felt for exempting big chain retailers and wholesalers from the stock control order as reports were coming that wholesalers and big chain retail outlets were facing problems in their sale due to the control order as the limits specified for them was very less and replacement of shelf stocks in city limits is not possible on an everyday basis,” it said.
As per the ministry, the stock limit imposed was based on the limits specified in the stock limits in the year 2008, calling it a conscious decision to keep the quantities in ‘limit’. But today, there are more big chain retailers in the market compared to 2008. The stock limit order was imposed then due to the price rise in domestic as well as international markets. The high prices and stocking up led to black marketing, profiteering, and hoarding.
Now the government has decided to make a timely interruption and this led to a visible decline in the ever-rising prices. Not only this, but this intervention will help to keep a check on black marketing, profiteering, and hoarding. The ministry added that this timely intervention by the government led to a significant decline in the skyrocketing prices and helped to keep a check on hoarding, especially soybean seeds.
