Solvent Extractors’ Association of India raises concerns over new vegetable oil rules

INDIA – The Solvent Extractors’ Association of India (SEA), the industry body representing the country’s edible oil producers, has expressed concerns that the newly introduced vegetable oil regulations could pose significant challenges for smaller producers and unorganised mills. 

The revised framework, titled the Vegetable Oil Products Production and Availability (Regulation) Amendment Order, 2025, replaces key provisions from the 2011 regulation and aligns with the Collection of Statistics Act, 2008.

The government aims to enhance transparency, improve data accuracy, and support evidence-based policymaking across the edible oil value chain.

However, SEA President Sanjeev Asthana cautioned that the new requirements, including mandatory portal-based registration and monthly reporting, may be challenging for thousands of small producers who lack digital infrastructure.

“The bigger question is whether the government can identify and onboard all such units,” noted Asthana.

“Without full coverage, compliance gaps could persist despite tighter rules, defeating the objectives of the Order”.

Under the amended order, all vegetable oil producers must register with the Directorate of Sugar and Vegetable Oils in New Delhi and submit monthly reports by the 15th of each month detailing factory location, production capacity, oil usage, stock levels, sales, and purchases.

The regulations empower authorities to conduct surprise factory inspections and seize stocks if non-compliance or false reporting is detected.

While larger players are expected to adapt quickly, SEA has flagged several practical concerns: data confidentiality, cross-departmental data sharing, and technical reliability of the reporting portal.

Asthana warned that system glitches near filing deadlines could lead to inadvertent non-compliance.

SEA also urged the government to provide more precise definitions for blended and value-added products and to implement a reasonable transition timeline to avoid market disruption.

Despite these concerns, Asthana acknowledged the long-term benefits of a well-regulated sector, including improved market intelligence and enhanced global competitiveness for India’s vegetable oil industry.

The edible oil sector is crucial to India’s food economy, with India being the world’s largest importer of vegetable oils.

The new regulations aim to stabilise supply chains and pricing, addressing long-standing challenges caused by data gaps, hoarding, and inconsistent availability.

Despite implementation challenges, SEA acknowledged that better regulation and transparency would ultimately benefit policymakers, producers, and consumers and support India’s competitiveness in the global vegetable oil market.

The SEA represents 875 members, including around 350 solvent extraction plants with a combined processing capacity of 30 million tonnes annually.

As the industry braces for the new compliance landscape, the association’s call is to ensure that the new regulations are implemented in a way that includes all producers, both large and small, to achieve the desired outcomes of supply stability and transparent market practices.

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