The other oil imports India needs to worry about
- November 22, 2023
- Posted by: OptimizeIAS Team
- Category: DPN Topics
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The other oil imports India needs to worry about
Subject : Economy
Section: External sector
Context:
- India’s edible oil imports have risen almost 1.5 times and more than doubled in rupee value terms during the last 10 years.
Details:
- Imports of vegetable oils touched a record 16.5 million tonnes (mt) in the year ended October 2023.
- The 16.5 mt of edible oil imports in 2022-23 included palm (9.8 mt; from Indonesia, Malaysia and Thailand), soybean (3.7 mt; from Argentina and Brazil) and sunflower (3 mt; from Russia, Ukraine and Argentina).
- From a 10-year perspective, India’s edible oil imports have increased from 11.6 mt (valued at Rs 60,750 crore) in 2013-14 to 16.5 mt (Rs 138,424 crore) in 2022-23, with the jump pronounced in the last three years.
- During the previous 10 years between 2004-05 and 2013-14, imports had shot up even more, from 5 mt to 11.6 mt.
Dipping self-sufficiency:
- Total available oilseed in India- 26.8 mt
- Domestically produced- 10.3 mt (38.6% of total oilseeds available)
- Imported- 16.5 mt
- Total consumption requirement- 24-25 mt
Profile of domestic oils:
- The kapas or raw un-ginned cotton contains only about 36%lint (the white fluffy fibre that textile mills spin into yarn), 62%seed and 2% waste.
- Cottonseed contains 13%oil.
- Higher yields from genetically modified (GM) Bt technology helped boost the lint as well as cottonseed oil production from less than 0.5 mt to 1.5 mt between 2002-03 and 2013-14.
- Recently, cotton oilseed production has decreased due to falling cotton output and yield, and pest attacks like Bollworm.
- Other oilseed sources- The oils extracted from rice bran (the outer brown layer of rice after the removal of the husk and before polishing/whitening), germ (the inside endosperm of maize grains separated during milling), palm tree,groundnut, coconut, sesame, sunflower and safflower.
Refining of petroleum oil:
- Refining involves de-gumming (removing gums, waxes and other impurities), neutralisation (removing free fatty acids), bleaching (removing colour) and de-odourisation (removing volatile compounds).
Vulnerability to imports:
- Risk of international price fluctuations.
- The UN Food and Agriculture Organization’s vegetable oils price index (base period value: 2014-2016=100) soared from 98.7 points in August 2020 to an all-time high of 251.8 points in March 2022, the month that followed Russia’s invasion of Ukraine. The index has since plunged to 120 points in October 2023.
- Landed prices of imported oils are more than halved — from $1,828 to $910 per tonne for crude palm and from $2,125 to $1,005 for sunflower between March 2022 and now. Thus increasing the competition for domestic producers.
Solvent Extractors’ Association of India (SEA):
- It was formed in 1963 to help and foster the development and growth of the Solvent Extraction Industry in India.
- At present, the Association has 875 members including about 350 working solvent extraction plants having a combined oilcake/oilseed processing annual capacity of about 30 million tonnes.
- It is an all-India body to the solvent extractions industry and the premier vegetable oil Association in the country having wide representative membership consisting of processors of Rice bran, Oilcakes, Minor Oilseeds and Soybean.
Source: Indian Express