India’s April palm oil imports slump 30% to 14-month low

Buyers were shifting to sunflower oil and soyabean oil due to palm oil’s premium over rival oils, a trade source was quoted as saying.

The big drop in purchases by the world’s top buyer could impact palm oil prices, which are near a seven-month low, according to the 12 May report.

It was also likely to make it difficult for leading producer Indonesia to increase exports after easing restrictions imposed on shipments earlier this year, traders said.

The average monthly imports in the first five months of the 2022/23 marketing year that started on 1 November were 879,000 tonnes, according to the SEA.

Buyers in southern India were replacing palm oil with sunflower oil, which was trading at a steep discount to the tropical oil, according to a New-Delhi-based dealer with a global trade house.

Sunflower oil typically commanded a premium over palm oil and was trading at a premium of as high as US$500/tonne last year, the report said.

India’s sunflower oil imports in April surged 68% compared to March to 249,122 tonnes, while soyabean oil imports increased slightly by 1.4% to 262,455 tonnes, the dealer was quoted as saying.

“This trend will continue even in May. This month sunflower oil was trading at a discount of as high as US$50 per tonne,” he added.

India’s total vegetable oil imports in April fell 10.4% to 1.05M tonnes, the trade body said.

Meanwhile, India clarified on 11 May that duty-free imports of soyabean oil and sunflower oil shipped before 31 March would be allowed until the end of June following reports of cargoes being stuck at ports due to confusion over import rules, Reuters wrote.

The move would increase the availability of soyabean oil and sunflower oil in May and June and prompt buyers to reduce palm oil purchases, a Mumbai-based trader was quoted as saying.

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