India Looks at Measures to Control Prices

India could be set to introduce some radical measures in an effort to rein in soaring prices of edible oils, including the banning off futures trading and a reduction in customs duty for imported oils.

Speculation is rife among traders that the government is planning to take action in an effort to tackle the high domestic prices of vegetable oils in the country. Global prices of palm oil and soya oils have surged to record highs in recent weeks and demand is strong due to the festival season in the country.

Among the options said to be under consideration are the suspension of futures trading in edible oils; a ban on the export of edible oils, in particular groundnut (peanut) oil; a ban on the export of oilseeds; and a further reduction in the customs duty on imported edible oils.

It was hoped that the autumn Kharif oilseed crop would provide some relief for customers after it was estimated at 16.5m tonnes, up from last year's 13m tonnes, but this has thus far failed to materialise.

However, the Indian government is in a dilemma due to the fact that some states have demanded a ban o the sale of all imported oils in an attempt to boost locally produced oils. for instance, in the southern city of Kochi, local officials have banned the import of palm oil in order to help the region's coconut oil industry.

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