Centre extends date for stock limits to June 30 from March 31

Government has extended curbs on stock quantities on edible oils and oilseeds till 30 June 2022. The decision was taken on Friday in order to cool down the prices of edible oils.

The Government had earlier notified the stock limits on edible oils and oilseeds vide its Order dated 08th October 2021 and it is valid up to 31 March 2022. However, the quantities of stock limits of oils and oilseeds were left to be decided by the States/UTs on the basis of available stock and consumption patterns.

On review of this Order, it was observed that only six States viz. Uttar Pradesh, Karnataka, Himachal Pradesh, Telangana, Rajasthan, and Bihar had imposed the stock limit order in pursuance of the Central Order in their states. Since the implementation of stock limits across all States/UTs is necessary to transfer the full benefit of price control to end consumers, the Union Government has vide its Order dated 3rd February 2022 specified the quantities of stock limits of edible oils and oilseeds for all States/UTs except the above mentioned six States.

This decision would empower the Union Government and all States/UTs to regulate the storage and distribution of edible oils and oilseeds. This would also help the Government in checking a hoard of edible oils and oilseeds in the country. Earlier, the Government had announced reduction in the basic duty of Crude Palm Oil, Crude Soyabean Oil, and Crude Sunflower Oil from 2.5% to Nil. The Agri-cess on these Oils was also brought down from 20% to 7.5% for Crude Palm Oil and 5% for Crude Soyabean Oil and Crude Sunflower Oil.

Consequent upon this reduction, the total duty is now 7.5% for Crude Palm Oil and 5% for Crude Soyabean Oil and Crude Sunflower Oil. The basic duty on RBD Palmolein Oil has been slashed to 12.5% from 17.5% recently. The basic duty on Refined Soyabean and Refined Sunflower Oil has been slashed to 17.5% from 32.5%. It was observed that the maximum benefit of rationalization of duty had not been passed on to the end consumers and this latest initiative of the Government is another step in this direction.

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 the stakeholder Departments viz. DA&FW, DAHD, and DoCA. The following stock limits have been promulgated:-

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, 2000 quintals for wholesalers. Processors of edible oilseeds would be able to stock 90 days 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.

The Order further states that in case 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 & Public Distribution and bring it to the prescribed stock limits in this Control Order within 30 days of the issue of this notification.

The respective legal entities of the six (6) 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 the maximum benefit of the duty reduction is passed on to the end consumers.