Imports of sunflower oil to India decreased by 19% in January due to Houthi attacks on ships in the Red Sea

India’s palm oil imports fell to a three-month low in January as refiners increased purchases of rival soybean oil due to negative crude palm oil (CPO) refining margins, five dealers told Reuters on Monday.

Reduced purchases by the world’s biggest importer of vegetable oils could lead to higher palm oil inventories at top producers in Indonesia and Malaysia and put pressure on futures.

Palm oil imports in January fell 12% from the previous month to 787,000 metric tons, dealer estimates showed. Crude palm oil imports fell 16% to 541,000 metric tons last month, they said.

Palm oil imports declined primarily due to a significant reduction in CPO purchases as processors saw large negative margins over refined bleached deodorized palmolein (RBD), said Rajesh Patel, managing partner of edible oil trader and broker GGN Research.

“Imports of soybean oil increased as prices were highly competitive compared to palm products and refining margins were in positive territory,” he said.

Soybean oil imports in January jumped 24% from the previous month to 190,000 tons, but were well below the monthly average imports of 306,000 tons seen in the last marketing year ending Oct. 31, according to dealer estimates.

Imports of soybean oil are expected to rise sharply in the coming months as its premium over palm and sunflower oils has come down and the oil is now available at par with competing oils, said Sandeep Bajoria, CEO of Sunvin Group, a vegetable oil brokerage firm.

The Sectoral Association of India (SEA) is likely to release its January import data by mid-February.

Sunflower oil imports fell 19% to 211,000 tons in January as oil rose in price due to higher freight rates following the Hussite attacks on Red Sea vessels, dealers said.

Lower imports of palm and sunflower oils reduced India’s total edible oil imports to 1.19 million tons, down 9.2% from a month earlier, dealers said.

India buys palm oil mainly from Indonesia, Malaysia and Thailand, while it imports soybean and sunflower oils from Argentina, Brazil, Russia and Ukraine.

Tags: sunflower oil, soybean oil, India, palm oil