Edible oil prices:
New Delhi: September 24, 2026 The Central Government’s decision to cut the Basic Customs Duty (BCD) on crude and refined soybean, palm and sunflower oils is likely to put pressure on domestic edible oil prices in the coming weeks. The move is ahead of the festive season when demand for cooking oils usually rises.
The duty structure has been changed to slash BCD on crude soybean oil and crude palm oil to 5% from 10%. The duty on refined soybean oil and refined palm oil has also been brought down to 27.5% from 32.5%.
The government has cut down sunflower oil by a larger amount The Basic Customs Duty (BCD) on crude sunflower oil has been cut to nil from 10% and the duty on refined sunflower oil has been slashed to 22.5% from 32.5%. The new rates will be effective from 24 September 2026.
New Rates of Import Duty on Edible Oil
| Edible Oil | Old BCD | New BCD |
|---|---|---|
| Soybean Oil, Crude | 10% | 5% |
| Crude Palm Oil | 5% | 10% |
| Crude Sunflower Oil | 10% | None |
| Refined Soybean Oil | 32.5% | 27.5% |
| Refined palm kernel oil | 32.5% | 27.5% |
| Refined Sunflower Oil | 32.5% | 22.5% |
Why did the government cut import duty on edible oil?
The cut comes at a time when edible oil prices have been rising and the festive season is coming. India is highly import-dependent for its domestic edible oil requirements, therefore international prices, freight costs and currency movements are key factors for domestic prices.
The lower import duty will likely lower the landed cost of imported edible oils. This could eventually put downward pressure on wholesale and retail prices although the extent and timing of benefit reaching consumers will depend on factors including inventories, global prices, refining costs and the pricing decisions of companies and distributors.
Consumers could get relief before the festive season
Edible oils are extensively used in household consumption and in the preparation of sweets, snacks and fried food in the festive period. A reduction in import costs could therefore offer some relief to consumers if the benefit is passed through the supply chain.
The government has also called for the benefit of the reduced duty to be passed on to consumers, according to the notification reports and the government’s stated objective.
Impact on Edible Oil and FMCG Cos
The duty cut could also benefit edible-oil and FMCG companies as reduced import costs could lead to lower raw-material costs. “Packaged food and edible oil processing companies might see an impact on their input costs, but the net effect on margins would depend on how much of the benefit they are able to retain or pass on to customers in the form of lower prices.”
Your Bottom Line
The Centre’s recent cut in customs duty on soybean, palm and sunflower oils is aimed at reducing the import cost of key edible oils ahead of the festival season. The move will provide room for lower domestic cooking oil prices but consumers may not feel the full effect till lower-duty imports flow through the supply chain.
Market Sustain will keep a close watch on the impact of the duty cut on edible oil prices and FMCG companies.
