From Chairman's Desk

December 2017

 

 

Dear friends,

At the outset, let me wish you all a very very happy New Year bringing lot of prosperity and excellent business opportunities in this year. 

After a brief pause, overall exports from India rose 30.55 per cent to $26.19 billion in November on account of improved global demand, government incentives and simplification of GST refund process. 

Exports during November 2017 are valued at US $ 26.196 billion as compared to US $ 20.066 billion during November,2016. Cumulative value of exports for the period April-November 2017 was US $ 196.482 billion as against US $ 175.410  billion registering a positive growth of 12.01 per cent over the same period last year.

The much-awaited review of the Foreign Trade Policy (FTP) was announced on 5th December 2017 by Hon’ble Commerce & Industry Minister Shri Suresh Prabhu Saheb, announcing various measures to support the sagging growth of exports to help deal with implementation burden of the new Goods & Services Tax (GST) regime with special focus on labour intensive sectors including Agriculture.

The additional 2 per cent incentives under the MEIS across-the-board for agricultural products will certainly be a great support to our Agro exports, which have been struggling since the introduction of GST regime. Other measures such as the extension of validity of MEIS scrips from 18 months to 24 months and the provision of zero GST on sale of scrips will also help export sector in a big way. 

We have drawn the attention of the government regarding the decline in exports of groundnuts from India. Despite the bumper crop of groundnuts, our exports have declined. Exports of groundnuts from India during April-September, 2017 declined to 1,77,441 tons as compared to 2,22,291tons during same period in the previous year. In value terms the exports reduced to Rs. 1314.48 crores as compared to Rs.  1926.58 crores.

The groundnut exporters are severely impacted due to implementation of GST, slow refunds of GST and lower duty drawback rates. The drawback rates have been reduced from 1% to 0.15%, which has seriously blunted the competitive edge of Indian groundnut export sector. Considering these facts, the Council has requested the government to provide much-needed support to the groundnut export sector by way of giving 2% MEIS incentives for groundnuts.

We also appreciate the sensitivity of the government towards taking steps for facilitating exports which are facing difficulty in the GST regime. The Government has started refunding the GST paid by the exporters under the zero rating principle to promote exports. But the refund rules and processes suffer from many problems and need an urgent overhaul. We would like to reiterate that collecting a tax only to refund it later is an inefficient mechanism and therefore exports be exempted from payment of GST. 

With regard to scenario of Sesame seeds, exports from India during April-September, 2017 declined to 1,54,656 tons from 1,59,399  tons. Also value wise exports declined to Rs.1270.96 crores from Rs. 1360.85 crores.

Prices of various oilseeds (US$) are hovering around the levels as follows: 

Sesame Seeds

Basis FOB

Price per MT

Natural Whitish 99/1/1

Mundra / JNPT

1420

Natural Whitish 98/2/2 

Mundra / JNPT

1400

Hulled autodriedSortex regular 99.95%

Mundra / JNPT

1725

Hulled autodriedSortex Premium 99.97%

Mundra / JNPT

1820

Black 99/1  Sortexed

Mundra

1325

Black Jet Sortexed

Mundra

1460

Ethiopian Whitish Humera

Djibouti  

1400

Sudanese Whitish Gederaf

Port Sudan

1360

Nigerian mixed

Lagos

1260

 

Groundnut

Basis FOB

Price per MT

India

50/60 Java

Mundra

1080

60/70 Java

Mundra

1060

80/90  Java

Mundra

1000

40/ 50 Bold

Mundra

980

50/60 Bold

Mundra

950

60/70 Bold

Mundra

930

80/90 Java

Chennai

1040

China

24/28

Qingdao

1475

28/32

Qingdao

1490

Argentina

Edible Grade 38/42

CNF EU Main Ports

1400

Edible Grade 30/36

CNF EU Main Ports

1350

USA

Jumbo Runners

CNF EU Main Ports

1250


 

Other Oilseeds/oils

Basis FOB

Price per MT

Safflower Seed 1%

JNPT

540

Mustard seeds Bold 1%

Mundra

790

Mustard seeds small 1%

Mundra

810

Castor Seeds

Mundra

760

Castor Oil FSG

Kandla, in bulk vessel

1580

Source: Trade Estimates


We would like to draw your kind attention to the fact that as per FSSAI order dated 6th October, 2017, that it would be mandatory for all food businesses having Central License or State License to have at least one trained and certified Food Safety Supervisor for every 25 food handlers or part thereof on all their premises. This training is to be made mandatory in phases over the next two years. FSSAI has set up a website (https://fostac.fssai.gov.in) for managing the training program, assessment and certification. We urge all our members to comply with this requirement as early as possible.

Considering the fact that Unjha is one of the important sesame producing region in Gujarat and a large number of export oriented sesame processing units are located in and around Unjha, the Council organized Capacity Building Program in Unjha on 23rd December, 2017 aimed to strengthen linkages and backward supply chain. During the meeting, topics such as developing strategy for organic farming of sesame seed to meet quality requirement of Japan, need of traceability upto the farm level as desired by DG-Sanco Delegation from EU were discussed. Various eminent agricultural scientists sensitised the participants regarding the importance of GMP and GAP, research conducted for zones which are free from Striga, infestation of Striga and methodology to control it on crops. GST related Issues and international market scenario were also presented.

The Council is organising a similar capacity building program for Sesame seed & Groundnut export sector in Rajkot on 6th January 2018. We extend our cordial invitation to you all to benefit from this program. The Council is committed to organise such important programmes in different parts of groundnuts and sesame seed producing states.

The Trade Promotion Council of India, (TPCI) and Ministry of Commerce, Government of India is organizing "Indus Food", Food and Beverage Export Show and Global Hosted Buyer Program to be held on 18 – 19 January, 2018 in Noida, Delhi. It may be noted that the TPCI has invited over 500 pre-qualified, hosted international buyers from over 60 countries with an objective to provide an opportunity to source agro and processed products from India. Over 400 selected Indian Food and Beverage suppliers will be meeting the buyers from these countries. We once again urge all our members to take advantage of this excellent opportunity by participating in this event of great importance to India.

Once again, wishing you a great New Year ahead,

With Best Wishes and Regards,

Sanjay Shah
Chairman

 



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