India’s oilmeal exports fell 45 per cent between April and November this year. Data compiled by the apex trade body, Solvent Extractors’ Association (SEA), showed India’s oilmeal exports at 1.42 million tonnes (mt) during the period, as compared to 2.6 mt in the corresponding period last year. Shipment of soybean meal fell sharply to 0.25 mt in the first eight months of the current financial year compared with 1.60 mt in the corresponding period last year.
Bumper oilseed crop in South American countries has given them an edge over India. Besides, countries such as China and Vietnam have developed their own crushing after importing seeds from Argentina and Brazil. Over and above, India’s traditional market, Iran, has also witnessed a sharp increase in production from local sources.
“Oilseed prices are currently ruling high in India due to escalation in minimum support price (MSP). Farmers are not willing to sell seeds at a lower price. Therefore, cost of oilmeal production works out to between $ 50 and 70 a tonne higher than the realisation from exports markets. Therefore, Indian oilmeal exporters lost competitiveness in the international market completely,” said B V Mehta, executive director, SEA.
Oilmeal prices have declined steadily since May this year. Soybean meal average price fell to $ 557 a tonne in November from $ 710 a tonne in May. Similarly, rapeseed meal average price also fell to $ 242 a tonne in November from the peak of $ 274 a tonne in May.
“The only way forward is to raise differential import duty between crude palm oil (CPO) and refined edible oil (refined, bleached and diodized) at 15 per cent from the existing 5 per cent,” said Pravin S Lunkad, chairman of Pranav Bitek, a Pune-based feed science company.
With import duty of 2.5 per cent on CPO and 7.5 per cent on RBD, the differential duty works out to 5 per cent currently.