Dependence on edible oil import might rise to 68%

Imports in 2014-15, say trade estimates, could rise to 14.1 mt

A sustained fall in local output is set to increase India's dependence on imported edible oil to an alarmingly high 68 per cent in the oil year November 2014-October 2015.

The Solvent Extractors' Association estimates total vegetable oil imports, both for cooking and for other uses like making soap, surpassed last year's record in 11 months of the current oil year.

India is on road to importing 14.1 million tonnes in 2014-15.

This could threaten supply and prices if the governments of exporting countries like Indonesia, Malaysia and Argentina frame policies in favour of their farmers and processors and to the detriment of Indian importers, traders and consumers.

"India is being used as a dumping ground for edible oil. Excessive imports have exerted tremendous pressure on local prices and Indian farmers are losing interest in oilseed. This is alarming for the country's food security," said BV Mehta, executive director of the Solvent Extractors' Association.

The government has put in little effort to increase oilseed yield, which is less than 50 per cent of the global average.

Changing food habits

Also, consumption in India has increased substantially with changing food habits of lower middle class consumers.

"We estimate imports to climb one million tonnes next year," said Atul Chaturvedi, chief executive officer of Adani Wilmar, producer of the Fortune brand.

Both the kharif and rabi seasons last year had lower output of oilseed.

Domestic availability of edible oil has reduced by 600,000 tonnes per year in the last few years.

"The solution to India's oilseed deficit lies in better planting material, ability to lease land for contract farming and switching from wheat to rapeseed in Punjab and Haryana," said Dorab Mistry, director, Godrej International.