Gujarat to import palm oil

The move is aimed at curbing rising groundnut oil prices.

The Gujarat government has decided to import 10,000 tonnes of palm oil to control the soaring prices of groundnut oil in the state. The groundnut oil prices have almost doubled in the last one year to Rs 1,300 for a 15 kg tin, owing to the unavailability of groundnut kernel.

Oil millers feel that the industry will have to do a serious rethink, with the consumption of other groundnut products increasing in comparison to the groundnut oil consumption in the country.

"We are constantly monitoring the situation. However, for an instant measure to check the prices, we have decided to import 10,000 tonnes of palm oil, which will control the groundnut oil prices," said Chhatrasinh Mori, minister of state for civil supplies and consumer affairs, government of Gujarat.

"The shortage of groundnut kernel in the state has triggered the shortage of groundnut oil. There was a decline of 25 per cent in groundnut production last year, which has triggered this shortage," added S K Nanda, principal secretary, civil supplies and consumer affairs. The government has also carried out raids on some oil mills in the state, seizing around 50 lakh tonnes of stock in a raid on four oil mills and a trader's warehouse in Rajkot during the one month.

Meanwhile, experts believe that the direct consumption of groundnuts has increased tremendously over the years compared with the consumption of groundnut oil, leading to insufficient kernels reaching oil mills. B V Mehta, executive director, Solvent Extractors' Association of India, said, "The direct consumption of groundnuts has increased manifold in the country compared with that of the oil over the last few years. This, doubled with the increasing Bt cotton area in Gujarat, is decreasing the volumes to oil millers."

Bipin Patel, a Junagadh-based oil miller and a groundnut trader, said, "The consumption of groundnut oil across the country is only 20 per cent of the country's total edible oil consumption. Rest of the people consume soybean oil, cottonseed oil and sesame oil. The groundnut kernel is decreasing in the state. Even though I am in the oil extracting industry, I feel that the industry has to think seriously about the requirement to change with the demand."

While talking to Business Standard, said, "Carrying out raids on oil millers is not any solution to the problem as there is short supply of groundnut kernel and that is why oil prices are on the rise. Most of the oil mills are not getting any kernel and a majority of these mills are sick," said Ukabhai Patel, president of the Saurashtra Oil Millers' Association.