India’s move to impose higher import duty on agricultural products from the US will likely raise walnut prices by up to 15 per cent and apples by 9 per cent, helping growers in Kashmir and Himachal Pradesh. Pulses are unlikely to be affected because of ample domestic stocks and easy availability from Canada and Australia.
Traders expect walnut prices to rise as early as next week. For apples, the impact would be delayed because the new harvest is expected sometime in July, although fears of a lower domestic output may raise prices. Last week, India hiked customs duty, effective August 4, on several goods from the US, responding to Washington’s move to increase the import tax on certain steel and aluminium products.
India imports 15,000 tonnes of walnuts every year from the US, Chile and Ukraine to meet its domestic demand. Domestic production is 2.18 lakh tonnes, largely from Jammu and Kashmir.
“There is a huge increase in the import duty of walnut in shell, from 30 per cent to 100 per cent announced in May and now a further increase to 120 per cent to be implemented by August. This will impact demand and lead to increase in prices in retail by the month-end,” said Gunjan Jain, MD of VKC Nuts, an importer and processor of nuts.
Due to the hike, retail prices of walnut in shell may see an increase of Rs 70-80 a kg from the current Rs 450-550 a kg, he said. Imports from Chile and Ukraine, too, may increase. On almonds, the trade is not clear if the higher import duty announced recently would also cover shipments from countries like Australia, Iran and Afghanistan, Jain said. If it does, prices could see some market increase. “Domestic production is negligible and we annually import 1.30 lakh tonnes.Hence almond prices will increase once the duty is implemented in August,” he added.
The duty has been increased on almond in shell to Rs 42 a kg from Rs 35 and shelled variant to Rs 120 from Rs 100. The duty on apples has been increased from 50per cent to 75per cent. India, where domestic apple production is around 1.5 million tonnes a year, imports 0.25 million annually, according to trade executives. America accounted for 55per cent of India’s apple imports, which usually arrive in February-March, after the local harvest is over.
Due to the harvest of apple crop from Uttarakhand this month and by July from Himachal and J&K, the high import duty is unlikely to have any major impact on India demand and supply situation, said traders in the Azadpur mandi for now. But that could still weigh on sentiment, along with other factors like expectations of a lower output, and result in higher prices.
Source: economictimes.indiatimes.com