Mustard oil is a common kitchen ingredient in all Indian households. In India, people are used to this cooking oil for all kinds of recipes and cooking methods. You’ll be surprised to know that the prices of your favourite mustard oil have dropped. 

Current Prices of Mustard Oil: 

A bumper crop season

The major reason behind the drop in mustard oil price is the crop season. Mustard is a rabi crop, which makes it high in availability at the moment. In this season, the crops received sufficient rainfall and advantageous weather conditions, which helped produce good results. This leads to a decreased price of mustard seeds, which in turn is a raw material for mustard oil.

In addition, government policies such as providing subsidies on mustard seeds and fertilisers and providing the seeds at minimum selling price encouraged farmers to grow mustard seeds at a cheaper rate. 

The Global Edible Oil Market

Globally, the edible oil market is huge, which means there are a lot of options for consumers when choosing edible oil. Hence, mustard oil is not the only oil in the market but an option for many to choose from. Since the prices of other edible oils, such as palm oil, sunflower oil, and soya bean oil, have seen a decrease, mustard oil prices are bound to decline due to a decrease in other oil prices. 

Import and Trade Policies

Another factor is the change in import policies and trade dynamics. Several countries have reduced the import duties on edible oil to ensure that consumers do not suffer from inflation and higher rates of food items. In India, the government has reduced the import policies on the oil seeds and oils from the international market, which has impacted the price of local mustard oil. 

Additionally, countries like Canada, an important and large producer of mustard seeds, have seen a remarkable weakening of their currency in comparison to the US dollar. In order to sustain in the market, they have reduced the import duties on mustard seeds. 

Changing Consumption Pattern

In recent times, people have been switching to healthier food options. In terms of edible oil, people are opting for oils that have high unsaturated fat content, such as sunflower oil or palm oil, over mustard oil, which poses many risks to our health. The same trend is being opted by young generations in rural areas where mustard oil is a staple. This shift in consumption patterns has pressured producers to reduce prices in order to stay in the market and encourage consumers to use their products. 

Government interventions and price controls

Governments intervene regularly to control inflation, protect customers, and play a role in decreasing prices. The government keeps an eye on essential commodities like edible oils, and whenever the price rises, it steps in with policies such as releasing buffer stock, reducing taxes and duties on imports, and imposing price caps. In the case of mustard oil, the government also tries to keep the price lower by managing both demand and supply. 

In conclusion, the drop in mustard oil prices is the result of a number of factors, such as bumper harvests, changing consumption trends, import policies, global market trends, and government intervention. While consumers may benefit from the lower price, the government needs to ensure that the lowered price doesn’t become a risk for producers.