FNB News - Govt decides to reduce customs duty on export of sugar to zero per cent

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Govt decides to reduce customs duty on export of sugar to zero per cent

Friday, 23 March, 2018, 08 : 00 AM [IST]

Our Bureau, New Delhi

In order to promote exports with the objective of evacuating surplus sugar stocks from the country, the Government of India has decided to reduce customs duty on export of sugar from its current level of 20 per cent to zero per cent.

This will also help in maintaining the demand and supply balance, thereby stabilising the domestic sugar prices in the country.

During the current Sugar Season (SS) (2017-18), the sugar production in India is estimated to be substantially higher than the estimated domestic consumption. Sufficient surplus stock of sugar may be available for export.

Veg oil imports down by 9%
The Solvent Extractors’ Association of India has compiled the import data of vegetable oils (edible and non-edible) for the month of February 2018. The import of vegetable oils during February 2018 is reported at 11,57,044 tonne compared to 12,70,443 tonne in February 2017, consisting 11,24,999 tonne of edible oils and 32,045 tonne of non-edible oils, i e down by nine per cent.

The overall import of vegetable oils between November 2017 and February 2018 was reported at 47,85,778 tonne compared to 46,84,451 tonne, i e up by two per cent.

Import of vegetable oil (edible and non-edible) between November 2017 and February 2018
(Quantity in metric tonne)

Month	2017-18			2016-17			Percentage change
Month	Edible	Non-edible	Total	Edible	Non-edible	Total	Percentage change
November 2017	12,25,315	23,495	12,48,810	11,55,863	19,601	11,75,464	(+) 6%
December2017	10,58,289	30,494	10,88,783	11,74,296	35,389	12,09,685	(-) 10%
January 2018	12,46,847	44,294	12,91,141	10,12,085	16,774	10,28,859	(+) 25%
February 2018	11,24,999	32,045	11,57,044	12,34,255	36,188	12,70,443	(-) 9%
Total	46,55,450	1,30,328	47,85,778	45,76,499	1,07,952	46,84,451	(+) 2%

On March 1, 2018, the Government of India increased import duty on Crude Palm Oil (CPO), RBD Palmolein and RBD Palm Oil. The import duty on CPO increased to 44 per cent from 30 per cent (effective duty 48.4 per cent) and RBD Palmolein and Refined Palm Oil to 54 per cent from 40 per cent (effective duty 59.4 per cent) without changes in import duty on sunflower oil, rapeseed oil and soybean oil.

This increase in duty is a welcome step. Yet, the government has missed the opportunity to provide a 15 per cent duty difference between crude and refined oils as requested by the association to encourage domestic refining industry and promote Make in India. Likewise, there is a need to increase import duty on rapeseed, mustard or canola oil, soybean oil and sunflower oil to support the farmers.

Stock position at port and in pipeline
The stock of edible oils as on 1st March, 2018 at various ports is estimated at 757,000 tons (CPO 280,000 tons, RBD Palmolein 120,000 tons, Degummed Soybean Oil 170,000 tons, Crude Sunflower Oil 180,000 tons and 7,000 tons of Rapeseed (Canola) Oil) and about 1,440,000 tons in pipelines. Total stock at ports and in pipelines is reported at 2,197,000 tons, more or less same stock in February 2018. India’s monthly requirement is about 18.25 lakh tons and operate at 30 days stock against which currently holding stock over 21.97 lakh tons equal to 36 days requirements.

	Mar1, 2018	Feb 1, 2018	Jan1, 2018	Dec1, 2017	Nov1, 2017	Oct 1, 2017	Sept 1, 2017	Aug 1, 2017	July 1, 2017	June 1, 2017	May 1, 2017	April 1, 2017	March 1, 2017
Port stock	757	855	876	847	884	979	907	883	738	770	785	688	775
Pipe lines	1,440	1,340	1,300	1,420	1,460	1,610	1,590	1,540	1,390	1,335	1,335	1,225	1,190
Total stock	2,197	2,195	2,176	2,267	2,344	2,589	2,497	2,473	2,278	2,160	2,120	1,913	1,965

Import of refined and crude oil ratio
Between November 2017 and February 2018, the import of refined oil (RBD Palmolein) showed a declining trend, decreasing to 6,07,359 tonne from 9,16,438 tonne in the same period of last year. However, the import of crude oil increased and reported at 40,48,091 tonne compared to 36,60,061 tonne during the same period of last year.

Import of refined and crude edible oils (ratio) between November 2017 and February 2018
(Quantity in metric tonne)

Year (Nov-Oct)	Refined oils	%	Crude oils	%	Total
Nov 2017	1,47,362	12%	10,77,953	88%	12,25,315
Dec 2017	1,06,924	10%	9,51,365	90%	10,58,289
Jan 2018	1,50,664	12%	10,96,183	88%	12,46,847
Feb 2018	2,02,409	18%	9,22,590	82%	11,24,999
Nov 2017-Feb 2018 Nov 2016–Feb 2017	6,07,359 9,16,438	13% 20%	40,48,091 36,60,061	87% 80%	46,55,450 45,76,499
2016-17	28,70,928	19%	1,22,06,492	81%	1,50,77,420
2015-16	26,23,002	18%	1,19,48,336	82%	1,45,71,338
2014-15	16,59,070	12%	1,27,62,201	88%	1,44,21,271
2013-14	15,76,354	14%	1,00,41,980	86%	1,16,18,334

Import of palm and soft oil ratio
Between November 2017 and February 2018, overall palm oil imports have increased to 30,34,514 tonne from 28,73,438 tonne, while soft oil imports have decreased to 16,20,936
tonne from 17,03,061 tonne during the same period of last year.

Import of palm oil and soft oil (ratio) between November 2017 and February 2018 (Quantity in metric tonne)

Year (Nov- Oct)	Palm Oil		Soft Oil					%	Total
Year (Nov- Oct)	(RBD Palmolein + CPO + Crude Olein + CPKO)		Soybean	Sunflower	Rape	Others	Total
Nov 2017	7,16,968	59%	2,73,928	1,93,810	40,609	-	5,08,347	41%	12,25,315
Dec 2017	7,22,857	68%	79,250	2,36,655	19,527	-	3,35,432	32%	10,58,289
Jan 2018	8,34,444	67%	2,24,870	1,70,831	16,702	-	4,12,403	33%	12,46,847
Feb 2018	7,60,245	68%	1,33,787	2,12,531	18,436	-	3,64,754	32%	11,24,999
Nov 2017-Feb 2018 Nov 2016–Feb 2017	30,34,514 28,73,438	65% 63%	7,11,835 8,14,731	8,13,827 7,68,189	95,274 1,20,141	- -	16,20,936 17,03,061	35% 37%	46,55,450 45,76,499
2016-17	92,93,717	62%	33,16,207	21,68,754	2,92,652	6,090	57,83,703	38%	1,50,77,420
2015-16	84,42,840	58%	42,34,809	15,16,220	3,77,469	-	61,28,498	42%	1,45,71,338
2014-15	95,36,904	66%	29,85,944	15,42,599	3,55,824	-	48,84,367	34%	1,44,21,271
2013-14	79,57,960	68%	19,51,233	15,09,250	1,99,891	-	36,60,374	32%	1,16,18,334

Average prices and rupee depreciation
(Price in $/CIF Indian Port/Tonne)

Oils	Feb 2018	Jan 2018	Dec 2017	Nov 2017	Oct 2017	Sept 2017	Aug2017	July 2017	June 2017	May 2017	April 2017	March 2017	Feb 2017
RBD palmolein	677	669	661	702	716	729	684	683	700	727	705	731	773
Crude palm oil	675	669	662	703	717	730	670	681	697	725	706	734	783
Crude soybean oil	809	817	811	839	829	836	813	802	798	796	756	767	812
Crude sunflower oil	803	800	800	810	821	838	824	804	789	798	783	791	814
FE: $1 = (Average)	64.43	63.65	64.24	64.84	65.04	63.97	64.42	64.45	64.45	64.42	64.53	65.8	66.97

Since October 2016 and onwards, the landed price of RBD Palmolein and CPO have remained more or less the same encouraging import of RBD Palmolein at the cost of CPO. The spread between palm oil and soft oil also reduced encouraging the larger import of soft oils.

Import of non-edible oils
Import of non-edible oils during November 2017 and February 2018 is reported at 1,30,328 tonne compared to 1,07,952 tonne during the same period last year, i e up by 21 per cent. P F A D, P K F A D, C P S and RBD Palm Stearin are the major import of non-edible oils.