NEW DELHI : The Union government on Friday asked edible oil companies to slash oil prices by ₹15 per litre, amid easing supply bottlenecks internationally.
This comes following a steep decline in prices worldwide, driven by Indonesia’s decision to reverse the export ban on palm oil. Cooking oil prices have been on the rise ever since the Russia-Ukraine war broke out earlier this year, as the Black Sea region made up for over 75% of global sunflower oil exports before the war. India’s import bill of vegetable oil had surged over 63% in FY22 from the previous fiscal.
The consumer affairs ministry said global prices of edible oils have fallen by $300-450 per tonne in the past month, but the fall in the prices in the domestic market is “gradual”. However, the industry argued that changes in the retail prices would reflect with a lag.
“The department of food and public distribution, in a meeting on 6 July, has directed leading edible oil associations to ensure reduction in MRP (maximum retail price) of edible oils by ₹15 with immediate effect. The Centre also advised that the price to distributors by the manufacturers and refiners also needs to be reduced immediately so that the price drop is not diluted,” the ministry said in a statement on Friday.
A Mother Dairy spokesperson said the company reduced the MRP of Dhara Soyabean Oil and Dhara Ricebran Oil by up to ₹14 per litre, which will be available in the market by next week. “We anticipate a reduction in MRP of sunflower oil in the next 15-20 days,” the spokesperson added.
Adani Wilmar, which sells edible oils under the Fortune brand, said it already reduced the MRP of its Fortune range of edible oils by almost 15% a few weeks ago. “Given the fall in global prices, we will be passing on benefits of reduced raw material costs to consumers in the coming days,” said Angshu Mallick, chief executive of Adani Wilmar Ltd.
Earlier in May, the government allowed duty-free imports of 2 million tonnes a year for crude soyabean oil and crude sunflower oil.
The relief on edible oil will be effective until March 2024.
The ministry said that companies must pass on the benefit of reduced duty on edible oils and the significant drop in global prices to end consumers without fail.
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