The Hon. Wasantha Samarasinghe - Minister of Trade, Commerce, Food Security and Cooperative Development

¶ 01 Hon. Speaker, the answers are as follows:

¶ 02 (a) (i) Yes. The Consumer Affairs Authority (CAA), through market sampling, has detected substandard coconut oil unfit for consumption. (ii) Often, local producers lacking proper understanding of quality release substandard oil. Some intentionally compromise standards to cut production costs and maximize profits. (iii) Reported tactics include: (1) Mixing cinnamon oil, filtered used oil, imported oils or other oils to produce inferior products marketed as coconut oil. (2) Not following proper production methods, e.g., not using drying kilns; inadequately dried coconut chips develop mould, raising aflatoxin levels. (3) Poor cleaning and maintenance of equipment, leaving trapped chips to mould, threatening quality and standards. (4) Improper storage of chips allowing contamination by animals and birds, threatening quality. (5) Retail decanting from barrels that are reused without proper cleaning; residual aflatoxin can contaminate fresh oil. (6) Selling in containers without mandatory labelling (producer name, manufacture and expiry dates), making traceability and enforcement difficult even when substandard oil is found. (7) Reprocessing used coconut oil with chemicals and offering it for sale. (iv) Measures taken include: (1) Issuing two Gazette notifications under the Consumer Affairs Authority Act, No. 9 of 2003, to prevent adulteration and stipulate requirements for containers used in sale. (2) Working with the Coconut Development Authority and the Ministry of Health to improve quality. (3) Conducting regular market raids and sample testing based on complaints and on CAA’s own initiative. (v) Reasons include: (1) Many local producers do not comply with standards and regulations. (2) Unsafe packaging and storage (barrel sales) enable sale without or with false mandatory information.

¶ 03 (b) (i) Observed issues for small and medium oil mill owners include: - Raw material constraints due to production factors (weather, seed quality) leading to shortages. - Income instability from output fluctuations and price volatility. - Increased production costs; raw material scarcity and higher prices strain finances. - Difficulty accessing affordable credit due to stringent lending criteria and lack of collateral, limiting technology upgrades and scale-up. - Environmental compliance costs (waste management, sustainability). - Rising labour, energy and transport costs. - Low adoption of innovation and scientific advances among agri-SMEs, limiting competitiveness. - Inability to distinguish imported from local oil in the market, enabling imported oil to be sold as local; VAT exemptions on imported coconut oil adversely affect local millers. (ii) The Government and this Ministry focus on policy measures, including necessary regulatory changes via the Ministry of Industry and Entrepreneurship Development.

¶ 04 (c) Not applicable.