India’s palm oil, sunoil imports rise to record highs; soyoil drops

India’s imports of palm oil and sunflower oil in 2022/23 surged by 24% and 54% respectively, to record highs on a rebound in consumption and as both oils were available at a steep discount compared to rival soyoil, a leading trade body said on Monday.

Higher purchases by the world’s biggest importer of vegetable oils could help to lower palm oil stocks in Indonesia and Malaysia and support benchmark futures. The buying could reduce inventories in sunflower oil-producing Black Sea countries.

Palm oil imports stood at 9.79 million metric tonnes in 2022/2023 marketing year ended on Oct 31, while sunflower oil imports rose to three million tonnes, Mumbai-based Solvent Extractors’ Association of India (SEA) said in a statement.

Soyoil imports in the year fell 12% to 3.68 million tonmes, as for most of the months it was trading at a premium over palm oil and sunflower oil.

Total edible oil import in the year surged to a record 16.47 million tonnes, up 17.4% from a year ago, as the government’s move to cut the import tax on edible oils to 5.5% encouraged overseas buying, the SEA said.

The government reduced import taxes when edible oil prices were rising in the world market last year, but it did not raise them after prices fell, said a New Delhi-based dealer with a global trade house.

“The price correction in the world market, coupled with lower duties, made edible oil cheaper and boosted consumption,” the dealer said.

Higher imports lifted vegetable oil stocks to 3.3 million tonnes on Nov 1, from 2.46 million tonnes a year ago, the SEA said.

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

Indian refiners were buying aggressively during November 2022 to January 2023, and July to September this year, as prices were attractive in the world market, but they slashed imports in October 2023 because of higher stocks, said Rajesh Patel, managing partner at edible oil trader and broker GGN Research.

The country’s palm oil imports in October 2023 fell 15% from a month ago to 708,706 tonnes, the lowest in four months, the SEA said.

Soyoil imports in October 2023 slumped 62% from September to 135,325 tonnes, the lowest in 34 months. Sunflower oil dropped 49% to 153,780 tonnes, the lowest in seven months, it said.