Govt imposes stock limit on edible oil and oilseeds

In order to control the prices of edible oils in the retail market, the Union Government on Friday imposed stock limits on the storage of edible oils and oilseeds till the end of June this year. In October last year, the Government had imposed a stock limit for six months which was set to expire in March this year. In October, the Centre had left it to the States to decide the stock limit on oils and oilseeds on the basis of stock and consumption pattern.

New Delhi: In order to control the prices of edible oils in the retail market, the Union Government on Friday imposed stock limits on the storage of edible oils and oilseeds till the end of June this year. In October last year, the Government had imposed a stock limit for six months which was set to expire in March this year. In October, the Centre had left it to the States to decide the stock limit on oils and oilseeds on the basis of stock and consumption pattern.

However, a review carried out by the government showed that only six states Uttar Pradesh, Karnataka, Himachal Pradesh, Telangana, Rajasthan and Bihar had imposed the stock limit. The government felt that in order to bring down the prices of edible oils, stock limits must be imposed in all states and union territories. In the order issued on Friday, the Government has specified the stock limit of edible oils and oilseeds for all the states and union territories except the six states that had already imposed it following the Centre's order issued in October last year.

Officials said it was necessary to cool down the prices of edible oils. The Centre has reasons to be concerned as opposition parties have been targeting the government over the issue of price rise and inflation. According to officials said the decision would empower the Union Government and all States and UTs to regulate the storage and distribution of edible oils and oilseeds which would also help the Government in checking hoarding of edible oils and oilseeds in the country.

Stock limit comes into force at once

The stock limits specifying the quantities of edible oils and oilseeds Order, 2022 has been issued with immediate effect from 3rd February 2022. Under this Order, the stock limits have been set in consultation with different stakeholders. For edible oils, the stock limit would be 30 quintals for retailers, 500 quintals for wholesalers, 30 quintals for retail outlets of bulk consumers i.e. big chain retailers and shops and 1000 quintals for its depots. Processors of edible oils would be able to stock 90 days of their storage capacities.

For edible oilseeds, the stock limit would be 100 quintals for retailers, 2,000 quintals for wholesalers. The processors of edible oilseeds would be able to stock 90 days of production of edible oils as per daily input production capacity. Exporters and importers have been kept outside the purview of this Order with some caveats.

Compulsory declaration onthe government portal

Officials said if the stocks held by respective legal entities are higher than the prescribed limits then it has to be declared on the portal (https://evegoils.nic.in/eosp/login) of the Department of Food and Public Distribution and bring to the prescribed stock limits in this Control Order within 30 days of the issue of this notification. They said the legal entities of the six states which have been exempted in this order are to follow the stock limits prescribed by the State Administration and declare the same on the above-mentioned portal.

“The above measure is expected to curtail any unfair practices like hoarding, black marketing etc. in the market which may lead to any increase in the prices of edible oils. The above would also contribute to further reduction in prices by ensuring that maximum benefit of the duty reduction is passed on to the end consumers,” said the government.

Steps to control the edible oil prices

Earlier, the Centre had announced a reduction in the basic duty of Crude Palm Oil, Crude Soybean Oil and Crude Sunflower Oil from 2.5 per cent to nil. The Agri-cess on these Oils was also brought down from 20 per cent to 7.5 per cent for Crude Palm Oil and 5% for Crude Soybean Oil and Crude Sunflower Oil. As a result of these measures, the total duty is now 7.5 per cent for Crude Palm Oil and 5% for Crude Soybean Oil and Crude Sunflower Oil.

The Centre also slashed the basic duty on RBD Palmolein oil to 12.5 per cent from 17.5 per cent earlier. The basic duty on refined soyabean and refined sunflower Oil has been slashed to 17.5 per cent from 32.5 per cent. Officials said the maximum benefit of rationalization of duty had not been passed on to the end consumers and the latest initiative by the Centre is one more step to control the prices of edible oils.