INDIA OILS-TRADERS EXPECT DUTY CUT ON CRUDE PALM OIL
BOMBAY, May 22 (Reuters) - India may lower customs duties on crude palmoil by at least 10 percentage points in the next few weeks, but isunlikely to set any base price for imports, traders and analysts say."The duty on crude palm oil is likely to be reduced by a minimum of 10percentage points," said Devi Prasad Khandelia, chairman of CentralOrganisation for Oil Industry and Trade."The prime minister has already committed a revision in the dutystructure," he said.During an official visit to Malaysia last week, Indian Prime MinisterAtal Behari Vajpayee told a business delegation that New Delhi wouldreview import duty on crude palm oil (CPO).In February, India slapped its heaviest-ever import duty of 75 percenton crude palm oil and 85 percent on refined palm oil. The duty on soybeanoil remained unchanged at 45 percent on account of India's commitment tothe World Trade Organisation.Khandelia, who accompanied Vajpayee during the visit, said the dutycould be revised after some time as sowing of oilseeds will start soon."Any immediate duty revision would send a wrong signal to the farmers."But a bombay-based commodity analyst said the duty could be lowered ina couple of weeks.Traders and analysts said India was not likely to impose any base pricefor edible oil imports but may take some steps to curb duty evasion bytraders through under-invoicing.They said Indian customs officials have started checking importdocuments more carefully if import prices of RBD palm olein and CPO arequoted below $270 and $230 a tonne (c&f) respectively."The move is to check any duty evasion by traders and loss ingovernment revenue," an analyst said.These prices are based on the current market prices of palm oils in theglobal market and may vary with a change in the demand-supply situation,traders said."I don't think the government is considering any base price for palmoil imports," a trader said.Traders said there may be some opposition by farmers and industryorganisations if the duty is lowered.N. Ananthan, secretary of the Cochin Oil Merchant's Association, toldReuters that prices of coconut oil have declined by about 40 percent in ayear due to an increase in its production and availability of cheaper RBDpalm olein.He said thousands of farmers were expected to meet this week in thesouthern state of Karnataka to protest against the government's move tolower import duties."A cut in import duties will be suicidal for the government. We willprotest any such move," said O.P. Goel, chairman of Soybean ProcessorsAssociation of India.