The average capacity utilities of India's edible oil refineries are below fifty percent

Mumbai, Ta. 18 November 2019, Monday

The average capacity utilization of India's edible oil refineries has dropped from 5% to 5% in five years. This decline has been attributed to the rise in edible oil imports and the stagnation of domestic production of oilseeds.

According to data collected by the Solvent Extractors' Association (C), the capacity utilization of domestic refineries was 5% five years ago.

Oil mills, which are expected to increase consumption of edible oils in India, have increased their capacity from 5 to 5 lakh tonnes in the last five years to 1.5 million tonnes.

A decline in capacity utilities may indicate a decline in some mills. And if this happens, thousands of workers will lose their jobs, and even millions of rupees will become inactive, sources in the CC said.

With local units closing down, oil prices are pushing downward and sliding below support prices. This situation has been observed several times in the last five years.

Due to the increase in the import of refined oil, capacity utilization has declined, a CAD official said.

Imports of refined oils increased by 5 per cent to 8.5 lakh tonnes in the last year from 6-7 tonnes, compared to 5.4 lakh tonnes in 2-3 years.

It is only natural that the capacity of refineries, which are expensive compared to refined oils, is to reduce the usability of local oilseeds, he added. The availability of oilseeds in India has also remained steady at around 8 million tonnes in the last five years.