Center slashes basic custom duty on crude edible oils to 10%; Aims to reduce retail prices
Centre has reduced the Basic Customs Duty (BCD) on crude edible oils namely crude sunflower, soybean, and palm oils has been reduced from 20% to 10% resulting in the import duty differential between crude and refined edible oils from 8.75% to 19.25%, according to Ministry of Consumer Affairs, Food & Public Distribution. This adjustment aims to address the escalating edible oil prices resulting from the September 2024 duty hike and concurrent increases in international market prices. An advisory has been issued to edible oil associations and industry stakeholders to ensure that the full benefit of the reduced duty is passed on to consumers. 19.25% duty differential between crude and refined oils helps to encourage domestic refining capacity utilization and reduce imports of refined oils. Import duty on edible oils is one of the important factors that impacted landed cost of edible oils and thereby domestic prices. By lowering the import duty on crude oils, the government aims to reduce the landed cost and retail prices of edible oils, providing relief to consumers and helping to cool overall inflation. The reduced duty will also encourage domestic refining and maintain fair compensation for farmers.
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India Gazette
15 hours ago
- India Gazette
Duty reduction on crude edible oils beneficial for both refiners, consumers: CareEdge
New Delhi [India], June 22 (ANI): The recent cut in import duties on crude edible oils is beneficial for major industry players as it would encourage refiners to favour crude imports over refined oils, a report by CareEdge Ratings said. Also, according to the rating agency, the duty reduction would lead to improved capacity utilisation and enhanced refining margins through increased domestic processing. On May 30 this year, the government announced a reduction in the Basic Customs Duty (BCD) on key imported crude edible oils -- Crude Palm Oil (CPO), Crude Soybean Oil, and Crude Sunflower Oil -- lowering it from 20 per cent to 10 per cent. The move is widely seen as an effort to taper domestic edible oil prices and control food inflation. Post the duty cut, the Basic Customs Duty on Refined Edible Oils (RBD) remains at 32.5 per cent, widening the differential between Refined, Bleached, and Deodorized palm oil and crude variant of palm oil to 19.25 per cent and enhancing the competitive advantage for domestic refiners. Ultimately, it will aid better price discovery for retail consumers. India remains the world's leading importer of edible oils, meeting approximately 55-60 per cent of its domestic consumption through overseas purchases primarily from Indonesia and Malaysia. 'The increase in duty differential between crude and refined edible oils shall enhance competitiveness for domestic refiners,' the CareEdge report read. Domestic retail edible oil prices, which saw firm trends during the first half of 2025 due to elevated global prices and currency depreciation, are expected to soften over the coming weeks as refiners pass on cost advantages resulting from the duty reduction, the rating agency said. The Ministry of Consumer Affairs has also issued directives requiring edible oil companies to revise their Maximum Retail Prices (MRPs) downward and submit weekly updates on Price-to-Distributor (PTD) rates. With food inflation (CPI-based) easing to 2.8 per cent in May 2025 (as per data from the Ministry of Statistics and Programme Implementation) and the Indian Meteorological Department forecasting a stronger-than-normal monsoon, these developments are anticipated to reinforce the downtrend in edible oil retail prices collectively. 'The recent duty revision acts as a timely and prudent policy intervention aimed at moderating inflationary pressures while bolstering the competitiveness of domestic refiners. The increased duty differential is expected to enhance gross refining margins and boost capacity utilisation in the near term. Additionally, the reduced landed costs will likely result in a price correction over the near term, ultimately benefiting retail consumers,' said Rajan Sukhija, Associate Director, CareEdge Ratings. Priti Agarwal, Senior Director, CareEdge Ratings, said, 'The move is a win-win for all in the domestic edible oil manufacturing value chain as it will not just strengthen the capacity utilisation of domestic refiners but also ensure a fair price to domestic oilseed farmers and a fair price to consumers.' (ANI)
Time of India
16 hours ago
- Time of India
Duty reduction on crude edible oils beneficial for both refiners, consumers: CareEdge
The recent cut in import duties on crude edible oils is beneficial for major industry players as it would encourage refiners to favour crude imports over refined oils, a report by CareEdge Ratings said. Also, according to the rating agency , the duty reduction would lead to improved capacity utilisation and enhanced refining margins through increased domestic processing. On May 30 this year, the government announced a reduction in the Basic Customs Duty (BCD) on key imported crude edible oils, Crude Palm Oil (CPO), Crude Soybean Oil, and Crude Sunflower Oil, lowering it from 20 per cent to 10 per cent. The move is widely seen as an effort to taper domestic edible oil prices and control food inflation . Post the duty cut, the Basic Customs Duty on Refined Edible Oils (RBD) remains at 32.5 per cent, widening the differential between Refined, Bleached, and Deodorized palm oil and crude variant of palm oil to 19.25 per cent and enhancing the competitive advantage for domestic refiners. Live Events Ultimately, it will aid better price discovery for retail consumers. India remains the world's leading importer of edible oils , meeting approximately 55-60 per cent of its domestic consumption through overseas purchases primarily from Indonesia and Malaysia. "The increase in duty differential between crude and refined edible oils shall enhance competitiveness for domestic refiners," the CareEdge report read. Domestic retail edible oil prices, which saw firm trends during the first half of 2025 due to elevated global prices and currency depreciation, are expected to soften over the coming weeks as refiners pass on cost advantages resulting from the duty reduction, the rating agency said. The Ministry of Consumer Affairs has also issued directives requiring edible oil companies to revise their Maximum Retail Prices (MRPs) downward and submit weekly updates on Price-to-Distributor (PTD) rates. With food inflation (CPI-based) easing to 2.8 per cent in May 2025 (as per data from the Ministry of Statistics and Programme Implementation) and the Indian Meteorological Department forecasting a stronger-than-normal monsoon, these developments are anticipated to reinforce the downtrend in edible oil retail prices collectively. "The recent duty revision acts as a timely and prudent policy intervention aimed at moderating inflationary pressures while bolstering the competitiveness of domestic refiners. The increased duty differential is expected to enhance gross refining margins and boost capacity utilisation in the near term. Additionally, the reduced landed costs will likely result in a price correction over the near term, ultimately benefiting retail consumers," said Rajan Sukhija, Associate Director, CareEdge Ratings. Priti Agarwal, Senior Director, CareEdge Ratings, said, "The move is a win-win for all in the domestic edible oil manufacturing value chain as it will not just strengthen the capacity utilisation of domestic refiners but also ensure a fair price to domestic oilseed farmers and a fair price to consumers."
Time of India
4 days ago
- Time of India
'Slow Food' calls for European Union (EU) agrifood trade overhaul; urges shift to agroecology, fair farmer incomes & shorter supply chains
BATHINDA: Slow Food, a global movement of farmers united by the goal of ensuring everyone has access to good, clean, and fair food, has called for a bold shift in European Union (EU) trade policy. The organisation is advocating for policies that support agroecology and fair farmer incomes through a reformed Common Agricultural Policy (CAP), along with: Environmental and social production standards on imported food through " mirror measures ". Shorter, fairer supply chains that empower local producers and communities. Food sovereignty and agrobiodiversity rooted in food cultures and inclusive governance. As global food prices remain volatile and supply chains face increasing disruptions, Slow Food released a new policy brief on Wednesday, urging the EU to rethink its approach to food trade. The brief, titled 'What's the Deal? Making EU Agrifood Trade Work for Better Food Systems', explores how the current global trade model—based on deregulated markets, export-led agriculture, and corporate consolidation—is undermining the shift towards fairer and more resilient food systems, both in Europe and worldwide. As a major global trading power, the EU plays a significant role in sustaining this flawed system. Its current agrifood trade policies are seen as hindering progress towards more diverse, equitable, and sustainable food systems, at home and abroad. The trade tensions of 2025, triggered by US tariff threats, highlighted the fragility of the global food system—one so unstable that the actions of a single government could push millions into hunger and poverty. However, crises can also bring new opportunities. 'The fragile state of global food prices and supply chains is a direct result of a broken trade system. The EU must use this moment to shift towards agroecological, localised, and socially just food systems,' said Marta Messa, Slow Food Secretary General. 'Europe must stop outsourcing the true cost of its consumption. We need a trade policy that nourishes people—not just corporate profits.' The policy brief begins by examining the failures of the current food trade system, rooted in colonial exploitation, deregulation, and the rise of powerful corporations. It identifies the causes of the crisis, including the industrialisation of agriculture, market liberalisation, and treating food as a simple commodity. In response, Slow Food presents an alternative vision, grounded in agroecology, food sovereignty, and the relocalisation of food systems. It proposes three key reforms: Enforcing mirror measures so all imported goods meet EU environmental and social standards. Supporting a shift away from industrial animal farming towards agriculture that ensures better animal welfare. Strengthening corporate accountability and promoting local food democracy to transfer power back to communities.
