The government has reduced the basic customs duty (BCD) on crude sunflower oil to nil from 10%, while the duty on refined sunflower oil has been cut to 22.5% from 32.5%. These changes, effective from September 24, are part of a broader move to lower BCD on crude and refined palm, soybean, and sunflower oils. The decision is aimed at easing input‑cost pressures for packaged food and consumer goods companies as the festive season approaches, potentially improving margins and supporting higher volumes.

For crude soybean and palm oil, the BCD has been lowered to 5% from 10%, and the BCD on refined varieties has been reduced to 27.5% from 32.5%. The duty reduction applies to all imports of these oils, providing a direct cost advantage for companies that rely on these inputs. The changes are designed to make imported oils more competitive against domestic production, which is constrained by biofuel mandates and acreage limits.

Edible‑oil companies such as AWL Agri Business, Godrej Agrovet and Patanjali Foods stand to benefit from lower import costs. The duty cut could reduce the landed cost of imported crude palm, soybean and sunflower oil, potentially providing margin relief or enabling the companies to pass on lower prices to consumers. The benefit will depend on each company’s product mix and pricing strategy.

FMCG players including Britannia Industries, HUL, Marico, Nestlé India, Bikaji Foods, Godrej Consumer Products, Dabur India and Jyothy Labs could see easing in raw‑material costs. Edible oils are widely used in biscuits, snacks, packaged foods and other consumer goods, so the duty cut may support margins or volumes if part of the cost reduction is passed through to consumers. The impact will vary across companies.

Lower edible‑oil prices could also support consumption and volumes during the upcoming festive season, although the extent of margin benefit will depend on how much of the cost reduction is passed on to consumers. The duty reduction may shift demand away from palm oil, which is expected to remain relatively expensive due to B50 biofuel mandates and reduced acreage expansion. Greater flexibility to import sunflower and soybean oil could increase availability across the country.

Sudhakar Desai, President of the Indian Vegetable Oil Producers’ Association (IVPA), said the duty cut comes at an important juncture as the festive season approaches. He noted that lower import duties should improve landed costs and potentially reduce consumer prices. Desai highlighted the need to ensure adequate availability during the festival months, given higher household demand and increased requirements from sweets, snacks, food‑service and HORECA segments. He also urged an import quota on zero‑duty imports from SAFTA countries to address competitive pressure from Nepal.