Edible Oils Prices to Remain Firm This Year: Fitch.

New Delhi, (PTI) Consumers may have to better their skills in managing household budget as prices of edible oils are seen to remain firm this year because demand is oustripping the total domestic supply, a latest report said.

At present, in most retail markets, groundnut oil is available at as high as Rs 135 per kg, sunflower oil at Rs 110 per kg, soya oil at Rs 83 per kg and mustard oil at Rs 78 per kg, the government data showed.

According to the report by Fitch ratings, "The widening of supply-demand gap is likely to result in firm pricing in 2011." The country''s edible oils production is expected to grow by 2.7 per cent to 6.7 million tonnes in the 2010-11 oil year, while demand is seen up by five per cent at 16.4 million tonnes, it said.

The oil year runs from November to October.

The report noted that India will continue to run an edible oil deficit over the longer term and will increasingly rely on imports to meet its growing consumption needed.

It further said that the country''s overseas import of edible oils is likely to increase to 9.7 million tonnes in the 2010-11 oil year from 9.1 million tonnes in a year-ago.

"Supply will be a constraint primarily on account of lagging seed production due to low acreage under oilseed cultivation and low crop yields and unpredictable monsoon," Fitch noted.

Last year, the country had produced only 6.5 million tonnes of edible oils and the demand stood at 15.6 million tonnes, it said.

The report also said that edible oil makers like K S Oils and Ruchi Soya are expected to post higher revenue growth because of firm price trend in cooking oils.

Source : in.finance.yahoo.com