The retail price of edible oil in several spot markets across the country have gone down by $0,06 to $0,27 per kg. Previously peanut oil was sold for $2,41 per kg in the market. The price drop is becoming a concern for the Indian peanut farmers.
Current Scenario
India is the largest importer of edible oil, and its domestic production fails to meet the local consumption.
- The imported peanut oil still meets about 56 to 60 per cent of the domestic demand.
- The international production of peanuts has gone down due to the weather and other reasons, putting pressure on the edible oil market.
- The other factor responsible for reducing the domestic production of peanuts is the peanut farmers moving towards the cotton plantation.
- As per the domestic demand for cotton, the cotton plantation area can be increased by 20-25 per cent. As a result, the peanut farmers are interested in planting cotton instead of Peanut.
- This becomes more evident when the cotton fetched by the farmers in Gujarat is $1,34 per kg, while for Peanut, it is $0,67 per kg.
- A.I. has proposed to increase the M.S.P by 3 to 5 per cent for the peanut farmers.
- Also, there are reports that most peanut farmers have incurred heavy losses in the Anantapur district due to the bad weather. Therefore, farmers of the region are advised to adopt climate-resilient agriculture.
Solution
- The government is taking measures to improve secondary oil production so that the dependency on imported oil lessens.
- Sustainable farming is being promoted that is weather-resilient, mainly for the dryland farmers. It includes measures like selecting the climate and soil appropriate crop for sowing. Next, use suitable fertilisers and natural mulching or inter-cropping to minimise the soil temperature.
- New schemes allow farmers and producers to get climate-appropriate crops and fertilisers. They can collect it from collection centres, cold storage, and registered farmers’ organisations.
Prediction
The peanut oil prices are likely to increase due to the production shortfall. Also, the increase in freight prices and the taxes levied by the export countries will add to the price increase for peanut oil for India.
Price Trend
The price of peanuts and their varieties is stable after a slight fall earlier this month.
Peanuts Quotations Bold 40-50
| Date | Price |
| February 7 | $1,22 per kg FOB |
| January 31 | $1,23 per kg FOB |