Cooking oil prices may rise again
Hyderabad: The cooking oil prices are likely to rise as Indonesia has decided to stop export of palm oil. Indonesia is the biggest producer of palm oil. The high inflation locally there forced the Government to stop exports to ensure there are adequate stocks for domestic consumption.
“Indonesia made a statement stopping exports from April 28. Per se, it is to control inflation in their homeland. Indonesia has 46 million metric tonne (mmt) production and they need about 15 mmt for domestic consumption. In addition, they need about seven mmt for their biodiesel production. Going by these figures, they are in need of exports in some form. We will have to wait and watch for a few more days for clarity,” said P Chandrashekhara Reddy, senior vice president, Sales and Marketing at Gemini Edibles and Fats India about the industry trends.
There is no clarity yet on what will happen to the contracts that Indonesia already entered. “What will they do for already entered contracts is to be seen?,” he said. However, these developments will impact the domestic oil prices in India.
Currently, palm oil is sold around Rs 175 per litre at the retail stores. Rice bran is priced around Rs 185, groundnut Rs 220, blended oil Rs 190 and sunflower oil at Rs 230 per litre. The prices of cooking oil have already increased following the military spat between Russia and Ukraine, two major producers of sunflower oil.
In a video broadcast, Indonesia’s President Joko Widodo said he wanted to ensure the availability of food products at home, after global food inflation soared to a record high following Russia’s invasion of major crop producer Ukraine. “I will monitor and evaluate the implementation of this policy so availability of cooking oil in the domestic market becomes abundant and affordable,” he had said.
Industry body Solvent Extractors Association of India (SEA) had said the announcement by Indonesia will hurt consumers in India and other countries too.
Global prices of crude palm oil have surged this year due to rising demand and also weak output from top producers. The Black Sea region of Russia and Ukraine accounts for about 76 per cent of world’s sunoil exports. Commercial shipping from the region has been severely affected since February. Soy and rapeseed oil supplies too have been hit due to lower crop in Argentina, Brazil and Canada.
Palm oil and its derivatives find a use in processed foods, cosmetics and biofuels. In March, about 5.5 lakh tonne of palm oil landed in India, up from 4.54 lakh tonne in February this year. The wholesale inflation increased to 14.5 per cent in March from 13.11 per cent in February and the increase in edible prices further will add to the inflation.
The prices of cooking have already gone by Rs 20-25 a litre compared to February. Logistics costs have increased and the pricing trend will be unpredictable till the war stops. The prices went up last year due to the Covid situation. Edible oil prices declined slightly in the December quarter after the Government lowered import duties, said an industry person.
Current retail prices of various oils per litre
Palm Rs 175
Rice bran Rs 185
Groundnut Rs 220
Blended Rs 190
Sunflower Rs 230
Cooking oil prices have increased Rs 20 to 25 a litre since February due to Russia-Ukraine military spat
Indonesia decided to stop palm oil exports from April 28
India is a key importer of palm oil
Palm oil and its derivatives find a use in processed foods, cosmetics and biofuels
Now you can get handpicked stories from Telangana Today on Telegram everyday. Click the link to subscribe.
Click to follow Telangana Today Facebook page and Twitter .
