24/09/2024 (Ofi Magazine) - The Indian government has raised customs duty on edible oils in a bid to support oilseed farmers, Reuters reported.

Effective from 14 September, a 20% basic customs duty on crude palm oil, crude soyabean oil and crude sunflower oil was introduced, the finance ministry’s notification on the same date said.

As the three oils were also subject to India’s Agriculture Infrastructure and Development Cess and Social Welfare Surcharge, the move would effectively increase the total import duty on the three oils from 5.5% to 27.5%.

The import tax on imports of refined palm oil, refined soyabean oil and refined sunflower oil increased from 13.75% to 35.75%.

The move could lift edible oil prices and dampen demand, leading to a reduction in imports of palm oil, soyabean oil and sunflower oil, Reuters wrote.

In August, Reuters reported India was looking into increasing import taxes on vegetable oils to help domestic soyabean growers ahead of regional elections due in Maharashtra later this year.

“After a long time, the government has been attempting to balance the interests of both consumers and farmers,” Sandeep Bajoria, CEO of vegetable oil brokerage Sunvin Group, was quoted as saying.

The move had increased the likelihood of farmers receiving the minimum support price set by the government for their soyabean and rapeseed harvests, Bajoria said.

According to the report, India meets more than 70% of its vegetable oil demand through imports, buying palm oil mainly from Indonesia, Malaysia and Thailand, while it imports soyabean oil and sunflower oil from Argentina, Brazil, Russia and Ukraine.

https://www.ofimagazine.com/news/india-raises-customs-duty-on-edible-oils-to-support-farmers