Soya trade wants subsidy on export cargo

The Soyabean Processors' Association (Sopa) would like the government to pay a transport subsidy to boost exports of soyabean meal.

The subsidy should be like that paid on sugar exports under the Sugar Development Fund Act 1982, Sopa said.

This will make Indian soyabean meal competitive in global markets.

A transport subsidy of Rs 700 will boost exports and benefit soyabean farmers too.

Export of soyabean meal accounts for 90 per cent of oil meal exports.

Last year, soyameal export totalled Rs 3000 crore.

Soybean oil, worth Rs 3500 crore, is a replacement for imported edible oil.

Sopa expects soyameal exports to touch 2 million tonne this year, but high transportation costs was making Indian meal increasingly uncompetitive in the international market against cargos from the USA and South American countries.

Soybean processing units there have plants located close to ports, which keeps freight rates low.

Price in the international market in 1998-99 was $142 per tonne on the Chicago Board of Trade (CBoT) while the Indian f.o.b. price was $145 per tonne.

At present, the CBOT price is around $154.1 and the Indian price $184.

Ocean freight from Mumbai to Singapore of $12 per tonne and the additional cost of transportation of oilmeals from hinterland to port is added onto the Indian price.

Sopa also wants excise duty on hexane and diesel, used to process soya into de-oiled cake, to be reduced.

In addition, it wants withdrawal of exemptions granted to new units in states like Gujarat, Uttranchal and Himachal Pradesh as it is hurting the older, established units not enjoying such concessions.

Removal of Rs 10 per tonne export cess payable on soya meal will promote trade too.

Finally, Sopa wants edible oil to be treated as an agricultural produce so that commission agents can be outside the service tax net.