With the month-long festival season ahead, consumers can heave a sigh of relief as the edible oil prices are unlikely to burn their pockets this year.
In last one month, the edible oil prices have fallen by 5% to 10% and further fall is expected before the festivities of Dusshera and Diwali begin.
Thanks to the excess supply of palm oil worldwide, used in the production of edible oil, the prices have cooled down in domestic market. It is a worrying factor for farmers as their margins may shrink, but for consumer, it is something to cheer for in the present inflationary era.
Compared to second week of September, the prices of various edible oils have come down in Gujarat. Cottonseed oil, which is believed to the most consumed edible oil in state, has seen 10% fall in its prices in a month. Groundnut oil has also shed its price by 5%. At the national level, soyabean oil is the second largest consumed oil after palm oil. Prices of soya oil have also fallen by 14% in last one month.
“The prices of all variants of edible oils have started to fall just because the palm oil prices are under pressure worldwide. India consumes 165 lakh tonne of edible oil out of which 95 lakh tonne is imported, mostly palm oil. The domestic production of edible oil is just 70 lakh tonne. 57% of the edible oil consumed in India is imported and that has a big say in determining the prices in India. In last one month, the palm oil prices have come down by 15% which has helped ease the high prices of oil,” said executive director of The Solvent Extractors’ Association of India, Dr BV Mehta, adding that correction in prices is going to continue.
“Globally, the supply of palm oil is exceeding the demand due to the bumper crop in Malaysia, Indonesia and other palm growing countries. Even though, production of oilseed crop is likely to be lesser in India due to delayed monsoon, the correction in palm oil prices will help edible oil prices to go downward,” he said.
Mehta also said that any appreciation in Indian currency against dollar will also help in reduction of prices further.
Echoing similar sentiments, CEO of Adani Wilmar, Atul Chaturvedi said that edible oil prices are under pressure which may benefit the consumer in coming festive season. “Vegetable oil contributes significantly to the inflation basket and if its prices are falling, the inflation rate will have positive impact. Looking at the present situation, it is difficult to predict how much the edible oil prices may fall. But it is certain that prices are under immense pressure because of which consumers’ Diwali is going to be good,” he said.