There is some good news for India’s predominantly import-dependent edible oil sector. The rapeseed production in India is likely to grow by 29.5% during the 2020-2021 crop year. This will be possible as farmers have brought more area under rapeseed cultivation, the apex body of vegetable oil producers and traders in the country, said COOIT.
The high prices of vegetable oils have been a chief contributor to the rising inflation in the country.
India is the world’s largest importer of vegetable oils. In 2020-21, the vegetable oil import bill touched a whopping $15.71 billion, 40% of the total agriculture import bill and 3% of the overall import bill. Compared to 8.5 million tonnes in 2020-21, the rapeseed production is expected to rise up to 11 million tonnes in the 2021-2022 crop year. Rapeseed has the highest 35-40% content and is one of the main oilseeds in India where it is popular as mustard.
"Sowing of mustard seeds has increased this year significantly in all major producing states, including Rajasthan," said Babulal Data, President of Central Organisation for Oil Industry and Trade (COOIT), said in a statement on Tuesday. Rajasthan accounts for over half of India's rapeseed production.
Farmers were encouraged by higher prices and favourable weather conditions to bring more areas under rapeseed cultivation. “Farmers got good prices for their mustard crop in the last rabi season. As a result, they have put more area under mustard cultivation in the ongoing rabi season,” Data said.
Indonesia, China, Malaysia, and the US are the leading vegetable oil producers in the world while India is the largest importer of these oils.
Covid Impact On Indian Vegetable Imports:
High prices and restrictions due to the Covid-19 pandemic have seen India’s import of vegetable oil marginally dropping to 13.13 million tonnes in 2020-21 from 13.17 million tonnes the year before – a trend seen for the past few years. However, the import bill on edible oils shot to Rs 117,000 crore in 2020-21 from Rs 75 lakh crore in 2019-20.
The rising cost of vegetable oils is a strain on the economy. However, the government charges 35-49.5% duty on vegetable oil imports.
In 2018-19, 25 million hectare of land was under oilseed cultivation which produced 35 million tonnes of oilseeds. Amid the rising prices of vegetable oils during the current year, the central government announced Rs. 11,000-crore National Edible Oil Mission-Oil Palm (NMEO-OP). The scheme aims at making India self-sufficient in edible oil.
“The government will ensure that farmers get all the facilities, from quality seeds to technology under the mission,” Prime Minister Narendra Modi had said while launching the plan on August 10.
Allowing the resumption of import of edible oils in July this year, Finance Minister Nirmala Sitharaman has said, “Because of the way oil seeds production has been affected and India’s high dependence on edible oil import is very high, the prices have gone up. Last year, crude and refined palm oil were not being imported at all. Now imports have resumed. This will immediately cool off the prices of edible oil.”
Content Credit: Arun Kumar Shrivastav
