Government monitors edible oil prices, consumption habits

The DoCA collects daily data on the prices of 22 essential food items, including six edible oils – palm, groundnut, mustard, vanaspati, soybean and sunflower – from 179 centers across the country. The department also collects daily prices for pulses, sugar, rice, wheat, tea, salt, milk and vegetables such as tomato, onion and potato.

In order to closely monitor the daily evolution of retail and wholesale prices of a few essential products, in particular edible oils, the government has started collecting information on market prices, as well as data on consumption patterns. region specific. The data will be used to make quick policy decisions aimed at minimizing the negative impact of high prices on consumers.

As the consumption pattern of edible oil varies by region, the Department of Consumer Affairs (DoCA) has started giving weight to the prices of specific edible oils in certain regions to arrive at daily national average prices. The reasoning is that this method helps the department understand more accurately the impact of prices on consumers.

The DoCA collects daily data on the prices of 22 essential food items, including six edible oils – palm, groundnut, mustard, vanaspati, soybean and sunflower – from 179 centers across the country. The department also collects daily prices for pulses, sugar, rice, wheat, tea, salt, milk and vegetables such as tomato, onion and potato.

Previously, the DoCA followed a system of simple averages to arrive at the national average price for edible oils.
“We realized that the simple national average of edible oil prices does not clearly reflect the real price movement,” DoCA secretary Rohit Kumar Singh told FE.

The department has also started collecting prices for branded edible oils from the centres. For example, mustard oil is mostly consumed in eastern and northern states, while the market basket is reduced in southern states. Groundnut oil is widely consumed in states such as Gujarat and Maharashtra.

The government is trying to follow a similar weighting of other commodities such as milk, wheat and rice.

In a bid to closely monitor the price development of commodities, the government has taken measures to keep a close eye on the price development, which helps in taking prompt action to curb rising prices.

On February 4, 2022, the government extended storage limits for edible oils and oilseeds until June 30, 2022 while specifying the amount of stocks that retailers, wholesalers and processors can hold. In October 2021, the government had imposed edible oils and oilseeds storage limits until March 31, 2022. However, the quantities of edible oils and oilseeds storage limits were left to the state and to the territories of the Union to decide on the basis of their respective consumption. model.

India imports about 55% of its total domestic edible oil requirements. India mainly produces edible oil varieties of groundnut, mustard, coconut and soybean.
Crude palm and soybean oils are imported mainly from Malaysia, Indonesia, Argentina and Brazil, and these products account for 62% and 21% of total edible oil imports respectively.

India depends on Ukraine for sunflower oil, which accounted for 14% of the total edible oil import basket in 2020-21.

According to estimates made by traders before the Russian invasion of Ukraine, imports of edible oils were expected to jump 28% year on year to reach Rs 1.5 lakh crore in 2021-22. By 2020-21, these imports had jumped 44%.

Edward N. Arrington