Oilseeds India

Edible Oil Deficiency in India

Currently, total edible oil production is just 7.31 million tonnes (mt). Estimated demand of edible oils in India is 24.5 mt.So, total edible oil import account for 65-70% of the domestic requirements. In early 1990s, it was less than 5%.
India is third largest consumer of edible oil. Total edible oil requirement by 2022 is estimated at 33.2 mt. Palm oil major edible oil imported as well as consumed by Indians. Other major oils are- Soybean Oil and Mustard oil.
India is the fourth largest oil seed-producing country in the world after USA, China and Brazil. Currently, annual oilseed production from primary sources in India is around 34 mt.
oilseeds accounts for 13% of the gross cropped area, 3% of the Gross National Product and 10% value of all agricultural commodities.
Major Oilseed producing states in India:

Commerce ministry has asked the Agriculture ministry to prepare a road map for India to attain self-sufficiency in edible oil production.

India imports most of its edible oils from Indonesia and Malaysia. Under the government’s plan to double farmers’ incomes, achieving self-sufficiency in oilseeds production by 2030 is a major target.Moreover, Malaysia has a duty advantage over Indonesia under the India-Malaysia Free Trade Agreement.

Challenges in meeting the edible oil demand domestically

Stagnation in oilseed production, at around 33 million tonnes
Low remuneration for farmers & Reduction in area under cultivation
Import dependence- imports has surged to 18% from 12% & average capacity utilisation of edible oil refineries has fallen to 46%, down from 65% five years ago
Agricultural condition- Majority of oilseed growers (more than 85%) are small and marginal farmers having poor resource base coupled with non-availability of quality seeds of varieties and hybrids.
No cohesive policy: on how procurement agencies are expected to liquidate their acquired oilseed stock has created more problems.

Way Forward

Diversification: Extending oilseed cultivation to underutilized farming locations
Under PDS: Including cooking oils to provide a fillip to procurement operations while ensuring affordable supplies.
Impetus to domestic varieties: Consumer awareness on benefits of indigenous varieties.
Control the imports:fix an annual ceiling on import; and the import trade should be monitored strictly.
Improved resources: availability of quality seeds, bridging the awareness gap in farmers regarding better techniques, developing supportive infrastructure facilities and ensuring an efficiently managed market for better price recovery.

Steps taken by government

to take annual production of edible oils from current 7.31 mt to 13.69 mt.
increasing oilseed production from primary sources from the current 34 mt to 45.64 mt.

Group of Secretaries (GoS) for launching a nationwide oil seed mission to minimise oil imports.Government may levy a 2-10% cess on import of crude and refined edible oil to fund the mission.
Ashok Dalwai committee on Doubling Farmers Income

The strategy for self-sufficiency in oilseeds production should encompass all three sources of oils

9 primary sources of oilseed crops (seven edible (soybean, rapeseed-mustard, groundnut, sesame, sunflower, safflower and niger) and two non-edibles (castor and linseed))
secondary sources (rice bran, cotton seed, solvent extracted oils)
tree borne oils (TBOs), namely, palm oil, coconut, other tree and forest origins

To incentivize palm tree cultivation- price incentive mechanism for farmers through creation of an Edible Oil Development Fund (EODF), with contributions coming from levying cess of 0.5% on the imports of crude and refined palm oil.

ISOPOM (Integrated Scheme of Oilseeds, Pulses, Oil Palm and Maize) Financial assistance to farmers for purchase of breeder seed, production of foundation seed, production and distribution of certified seed etc.
National Mission on Oilseeds and Oil Palm (NMOOP

It is implemented under three Mini-Missions (MM)

MM I – Oilseeds
MM II – Oil Palm
MM III – TBOs (Tree Based Oil)
targets increasing production of oilseeds to 42 mt by FY2022 from estimated 34 mt.
Increasing Seed Replacement Ratio (SRR) with focus on Varietal Replacement; increasing irrigation coverage under oilseeds from 26% to 36%.
diversification of area from low yielding cereals crops to oilseeds crops; inter-cropping of oilseeds with cereals/ pulses/ sugarcane, use of fallow land after paddy /potato cultivation
expansion of cultivation of Oil Palm and tree borne oilseeds in watersheds and wastelands
increasing availability of quality planting material enhancing procurement of oilseeds and collection;
Processing of tree borne oilseeds.

Pradhan Mantri Annadata Aay SanraksHan Abhiyan (PM-AASHA):ensuring remunerative prices to the farmers for their produce. Private Procurement & Stockist Scheme (PPSS). In the case of oilseeds, States will have the option to roll out PPSSs in select districts where a private player can procure crops at MSP when market prices drop below MSP.

Class Notes 4 You