Irrespective of invoice price, imports will be assessed to duty at the aforesaid tariff value. The move is revenue positive.

The palm oil market firmed up in the wake of problems in Argentina that affected soyabean oil shipments and purchases made by Indian importers.

There was speculation in trade circles over the last few days about revision in tariff values. For the last four to five weeks, crude palm oil prices had been ruling in the range of $335-345 a tonne cost and freight, while the applicable tariff value was lower at $ 314 a tonne.

At 65 per cent duty, the Government was losing revenue on crude palm oil which constitutes the bulk of India's imports. In April, crude palm oil arrivals totalled two lakh tonnes.

With the upward revision in tariff values, import pricing and assessment is expected to be at more realistic levels. Importantly, overseas palm oil prices will come under downward pressure, which will be further aided by restoration of soya oil shipments from Argentina.

Our Chennai Bureau adds: The revision in the tariff had a bullish effect on soya oil trading in the Chicago Board of Trade exchange. Soya oil for June delivery registered 0.05-0.12 cents rise in prices.

In Kuala Lumpur, physical prices for RBD palm oil was down $2.50 to $340 and that for RBD palmolein by the same margin to $350.

Though trade circles said the hike was expected, they were caught unaware with the timing of the notification.

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