In a situation where approximately 70% of the edible oil  requirement of in the country is met by imported oil, the central government increased the customs duty of 20% on crude palm, soya, sunflower oil, and refined oils.

This has led to volatile oil market, and purchases by traders from the mills and by consumers from traders fell significantly.

The trend of price increase in cotton-palm oil started at the beginning of the current week.

In the four days leading to September 12, cottonseed oil saw an increase by ₹130 and palm oil by ₹75. With the implementation of additional import customs duty from September 14, this it led to a huge increase of ₹110 in cottonseed oil and ₹160 in palm oil in a single day.

Because of this, cotton oil has increased by ₹240 per 15 kg can and palm oil by ₹235 in just six days.

Surprisingly, the groundnut cultivation has increased in India this year by 4 lakh hectares to 47.49 lakh hectares. In Gujarat too, it has increased from 16.35 lakh hectares to 19.10 lakh hectares.

Last year, 46.45 lakh tonnes of groundnuts were produced in the state in such plantations. Despite this, oil millers in Saurashtra have increased prices for groundnut oil ₹40 in one day.

Purchases have been sluggish in the market amid this price hike. Traders believe that trade has fallen by more than 50% due to price volatility and they have refrained from offloading goods for now.