Vanaspati on Fire

Vanaspati on Fire HEROIC imposition of statutory control over vanaspati prices and the threat to canalise supplies through State nominees for distribution of vanaspati through ration shops will not restore vanaspati to the sight of the consumer. The industry itself, to be fair, would not have fared better with its voluntary price fixation. Groundnut oil, which is the main component of vanaspati' has risen during the last five weeks or so by about Rs 1200 a tonne from Rs 2600 to Rs 3800. It had fallen earlier from about Rs 4700 a year back to Rs 2300 in last July on hopes of a good crop and the availability of imported soyabean oil The sudden change in the price situation was triggered off by floods in Gujarat and adverse weather in other groundnut growing regions; it was stimulated by the wrong decision of government to raise soyabean oil prices from Rs 2300, at which it was almost going abegging, to Rs 2800, which implied that it was following the market instead of countering it with a sound buffer stock policy. The situation has worsened because soya stocks are bottled up in Kandla, Madras, Bombay and Calcutta, and there arc not enough tank wagons to carry them up-country where nearly one-half of vanaspati is produced and consumed. Delayed deliveries of soya and the sudden spurt in groundnut prioss have caught nearly every vanaspati unit short of supplies. Many units have consequently either closed down or have cut back their production.