Why farmers are not enthusiastic about FM Sitharaman’s call for atmanirbharta in oilseeds

During the Oil Year (November 2022—October 2023), India imported 167.1 lakh tonne of edible oil – which was 16 per cent higher than the preceding year.

The Solvent and Extractors Association of India (SEA), the umbrella body of oil extractors and solvent manufacturers, in a press statement, had attributed this trend to the low 5.5 per cent import duty levied on crude palm oil. “This influx of imports has transformed India into a prime destination for excess oil supplies,” the press statement said.

Easy imports have seen soybean growers in Maharashtra and Madhya Pradesh, as well as groundnut growers in Gujarat, complain of lower realisation.

Soybean at the Latur wholesale market in Maharashtra is now trading between Rs 4,530-4,4400/quintal – lower than the government’s Minimum Support Price (MSP) of Rs 4,600. Similarly, groundnut in the Gondhal wholesale market in Rajkot district of Gujarat is trading between Rs 6,225-Rs 6,355/quintal, as compared to its MSP of Rs 6,377.

Vilas Uphade, director of Latur-based Vikas Farmer Producer Company, said, “The present prices (for soybean) do not even cover production costs. The government should take steps to ensure the grower gets at least Rs 5,000/quintal.”

The announcement by the finance minister failed to enthuse the growers who felt such measures would not be successful without assured prices.

India imports around 150 lakh tonne of edible oil, which is 60 per cent of its domestic consumption.

Kishor Viradiya, president of Saurashtra Oil Mills Association (SOMA), a chamber of oil mills of Suarashtra region, said that the government will have to give a clear roadmap for boosting domestic oilseeds production. “The Central government has been talking about increasing oilseeds production for the past two years. However, it is not providing any well-defined targets and a roadmap to achieve those targets. The government is not even specifying that its eventual goal is to increase domestic edible oil production. Unless there is clarity about goals and roadmap to achieve them, we are going to make little progress,” he said.

The SOMA president further called for “cohesion” in policy. “On the one hand, we are importing large volumes of edible oil to meet domestic demand and on the other, we are allowing exports of oilseeds like groundnut and edible oils. In the present environment of almost duty-free imports of edible oil, our farmers won’t be able to compete with global players,” Viradiya said, adding, “For increasing domestic oilseed production, the government will have to look at the scenario from farmers’ perspective, give them subsidised high-quality seeds and a market which will assure a good price for their harvest and incentivise domestic oilseed processing industry.”