09/04/2012 (Daily Times) - The Pakistan government should reduce duty on palm oil products’ imports from Malaysia just like the 15 percent duty cut made for Indonesia, importers said on Friday.

The Federal Ministry of Commerce is yet to implement the duty cut that was supposed to come into effect in early 2012, they added.

The palm oil products imports increased by 28.36 percent during July-February 2012 as compared to the same period last year.

The import was recorded at $1.611 billion in eight months 2012 as against $1.255 billion during same period 2010-11, according to Pakistan Bureau of Statistics (PBS).

In terms of quantity, the palm oil import increased by 7.74 percent by going up from 1,331,744 metric tonnes last year to 1,434,826 metric tonnes during the current year.

Duties on imports of palm oil products range between Rs 9,550 and Rs 10,950 per metric tonne and the share of edible oil in the total food imports remained 42 percent during this period, importers said.

Palm oil imports witnessed an increase of around 42 percent as against the corresponding period of last year.

The burgeoning prices of edible oil in the international market and increase in demand remained the main contributing factors in the import rise.

“We imported more than 2 million tonnes of edible oil products, that catered to about 76 percent of the total country’s edible oil consumption,” said Pakistan Vegetable Oil Mills Association (PVOMA) member Nasir Ibrahim.

Nasir said the country’s demand for palm oil usually increases around 6-7 percent two to three months before start of Ramazan.

The international price of Refined Bleached and Deodorised (RBD) palm oil is hovering around $1,163 per metric tonne while the price of palm olein around $1,153 per metric tonne.

The country consumes around 2.2 million tonnes edible oil every year out of which 0.63 million tonnes is contributed by the local growers and the remaining is imported to bridge the demand and supply gap, he added.

He said the import trade price (ITP) duty should be increased or decreased in proportion to the changes in the price of imported edible oils in the international market.

He said the rates of sales tax levied at 16 percent and withholding tax and federal excise duty charged at the rate of 2.0 percent on the imported palm oil should also be decreased.

Imports are made under Malaysian Palm Oil Concessionary Trade Agreement, like Free Trade Agreement, he added.

A crop analyst at Sindh Agriculture Forum said around more than 50 solvent extraction plants are operating in Pakistan, which produce more than 600,000 tonnes of edible oil yearly.

According to him, Pakistan has already imported 40,000 tonnes of soya bean under PL-480 programme from USA.

Pakistan imports around 8.0 percent of its total edible oil imports from Indonesia. After linking of the imports with the composite rates of dollar, the unabated increase in edible oil prices has already hit the masses severely as the price of palm oil in local markets has gone up.

He said due to higher import cost, the manufacturers of vegetable ghee and cooking oil are unable to pass on the maximum benefit in case of any slight decline as they are facing multiple problems including power and gas load shedding and production loss.