The Indian government has asked edible oil associations to reduce the maximum retail price (MRP) of major edible oils by Rs 8-12 per litre, aligning them with global market rates.
The Department of Food and Public Distribution held a meeting with representatives from the edible oil industry to discuss this matter.
Indian Govt Asks Edible Oil Associations To Reduce MRP
The government has also urged manufacturers and refiners to immediately lower the prices to distributors in order to ensure that the price drop is passed on to consumers without dilution. Companies with higher MRPs compared to other brands have been advised to reduce their prices as well.
The leading edible oil associations were instructed to communicate with their members and promptly reduce the MRP of major edible oils by Rs 8-12 per litre.
The ministry emphasized that whenever manufacturers or refiners reduce prices for distributors, the industry should pass on the benefits to consumers. The ministry also requested to be regularly updated on the progress.
The continued decline in global edible oil prices is expected to result in lower prices for Indian consumers. This reduction in edible oil prices will contribute to easing inflation concerns, if any.
Representatives from industry associations, including the Solvent Extraction Association of India and the Indian Vegetable Oil Producers’ Association, were present at the meeting to discuss further reductions in retail prices of edible oils.
Local Market Prices Should Decrease In Proportion To Declining International Prices of Imported Edible Oils
The ministry urged edible oil companies to ensure that local market prices decrease in proportion to the declining international prices of imported edible oils. They were instructed to promptly pass on the price decrease in the global market to the final customers.
The ministry explained that while international and domestic edible oil prices experienced an upward trend in 2021-22 due to various geopolitical factors, international prices have been falling since mid-June 2022. The government believes that associations can further reduce prices to provide relief to consumers.
According to the industry, the prices of various edible oils have decreased globally by $150-200 per tonne over the past two months. Consequently, the MRP has been reduced and is expected to be further reduced in the near future.
However, there may be a time lag for the reduced prices to be reflected in retail markets, but the industry assured that retail prices will soon decrease further.
