In November, India witnessed a surge of over 20% in palm oil imports compared to the previous month. Refiners showed a preference for this tropical oil, attracted by substantial discounts in comparison to competing soyoil and sunflower oil, according to information provided by five dealers to Reuters on Monday.
Increased acquisitions by the largest importer of vegetable oils globally may contribute to reducing palm oil stocks in leading producers Indonesia and Malaysia, thereby providing support to benchmark futures.
India’s palm oil imports for November surged by 22% compared to the previous month, reaching 867,000 metric tons, marking the highest volume in three months, according to estimates provided by dealers.
Sandeep Bajoria, CEO of Sunvin Group, a vegetable oil brokerage, noted that the discount on palm oil compared to soyoil and sunflower oil has been expanding in recent weeks. This trend is prompting refiners to shift towards palm oil.
India’s overall edible oil imports for November increased to 1.13 million metric tons, a 13% rise from the previous month, propelled by elevated palm oil imports, according to dealers.
Rajesh Patel, managing partner at GGN Research, an edible oil trader and broker, mentioned that edible oil stocks in the country have surged to nearly record levels. This has led refiners to sell off port stocks before placing new orders.
The Solvent Extractors’ Association of India (SEA) reported that domestic stocks of vegetable oil increased to 3.1 million tons by November 1, compared to 2.45 million tons a year earlier. The association is expected to release data on November imports by mid-December.
In November, imports of soyoil increased by 7% compared to the previous month, reaching 145,000 tons. However, this figure remains significantly below the average imports of 306,000 tons in the last marketing year, as estimated by dealers.
According to Vipin Gupta, the chief executive officer of Dubai-based trader Glentech Group, soyoil imports have been decreasing over the last two months. This decline is attributed to unfavorable refining margins, a substantial premium over competing oils, and a rise in local supplies.
Dealers reported a 21% decrease in sunflower oil imports, reaching 122,000 tons, marking the lowest figure in 17 months.
India predominantly procures palm oil from Indonesia, Malaysia, and Thailand. In contrast, the country imports soyoil and sunflower oil primarily from Argentina, Brazil, Russia, and Ukraine.
