India’s palm oil and sunflower oil imports saw substantial growth in the fiscal year 2022/23, surging by 24% and 54%, respectively, reaching record highs. This notable increase was fueled by a resurgence in consumption and the attractive pricing of these oils, which were available at a considerable discount compared to the rival soyoil, according to a leading trade body’s report on Monday.
Increased acquisitions by the world’s largest importer of vegetable oils may contribute to a decrease in palm oil stocks in Indonesia and Malaysia, providing support to benchmark futures. This heightened purchasing activity could also lead to a reduction in inventories in Black Sea countries that produce sunflower oil.
Palm oil imports reached 9.79 million metric tons in the marketing year ending on October 31, 2022, while sunflower oil imports rose to 3 million tons, according to a statement from the Mumbai-based Solvent Extractors’ Association of India (SEA).
Imports of soyoil for the year experienced a 12% decline, totaling 3.68 million tons, primarily due to its trading at a premium compared to palm oil and sunflower oil for the majority of the months.
Edible oil imports for the year soared to a historic high of 16.47 million tons, marking a 17.4% increase from the previous year. The surge was attributed to the government’s decision to reduce the import tax on edible oils to 5.5%, stimulating overseas buying, according to the statement from the Solvent Extractors’ Association of India (SEA).
During the previous year, the government lowered import taxes in response to the global increase in edible oil prices. However, according to a dealer based in New Delhi affiliated with a global trade house, these taxes were not subsequently raised when prices in the world market decreased.
“The price correction in the world market, coupled with lower duties, made edible oil cheaper and boosted consumption,” the dealer said.
Increased imports raised vegetable oil stocks to 3.3 million tons on November 1, compared to 2.46 million tons a year earlier, as reported by the Solvent Extractors’ Association of India (SEA).
India predominantly procures palm oil from Indonesia, Malaysia, and Thailand. In contrast, it imports soyoil and sunflower oil from Argentina, Brazil, Russia, and Ukraine.
From November to January and July to September, Indian refiners engaged in aggressive buying due to favorable prices in the global market. However, in October, they significantly reduced imports due to elevated stocks, as explained by Rajesh Patel, the managing partner at GGN Research, an edible oil trading and brokerage firm.
In October, the nation’s palm oil imports decreased by 15% compared to the previous month, totaling 708,706 tons, marking the lowest figure in the past four months, according to the Solvent Extractors’ Association of India (SEA).
Soyoil imports plummeted by 62% in October compared to September, reaching 135,325 tons, the lowest level in 34 months. Simultaneously, sunflower oil saw a decline of 49%, totaling 153,780 tons, marking its lowest point in the past 7 months, according to the reported information.
