Edible oil imports falls 21% since November
According to a SEA note, the availability of palm oil for edible oil requirements has come down as the main two producers Malaysia and Indonesia are diverting it for the production of biodiesel this may result in an increase in prices this year.
The imports of edible oils – palm, soybean and sunflower — in the first four months of the 2023-24 oil year (November-October) declined by 21% to 4.61 million tonne (MT) compared to same period last oil year. The high base of last year and an incipient spurt in global prices of the oils are the reason for the drop in imports on annual basis.
The Solvent Extractors’ Association of India (SEA) said on Wednesday that last month, the country imported 0.96 MT of edible oil both in crude and refined form, which is a 12% decline on year. As on March 1, total edible oils stock stood at 2.37 MT, a decline of 30% that of the year-ago period.
“Last year there was excess imports of cooking oil and global palm oil prices have been firming up in the last few weeks,” BV Mehta, executive director, SEA, told FE.
According to a SEA note, the availability of palm oil for edible oil requirements has come down as the main two producers Malaysia and Indonesia are diverting it for the production of biodiesel this may result in an increase in prices this year.
Out of the total import of edible oil in the 2023-24, palm oil imports was 3 MT, 17% decline from 3.67 MT of oil imported mostly from Indonesia, Malaysia and Thailand. Imports of soybean and sunflower oil during November-February of 2023-24 oil year was 0.66 MT and 0.9 MT respectively.
Soybean oil was sourced from Argentina and Brazil, while sunflower oil was sourced from Russia and Ukraine.
India’s import of edible oils – palm, soybean and sunflower – rose 17% on year to a record 16.47 MT in the 2022-23 oil year, helped by lower import tariffs of only 5.5% on crude oil imports.
India imports about 58% of the total annual edible oil consumption of around 24 to 25 MT. In terms of share in domestic output, the share of oils includes mustard (40%), soyabean (24%) and groundnut (7%), among others.
Landed prices of crude palm oil (at Mumbai port), which hold a major chunk in the country’s import basket, declined by 4% to $965/tonne on March 8, compared to $1,006 a year ago. Import prices at Mumbai of crude soybean and sunflower oil have fallen by 13% each to $995/tonne and $960/tonne respectively.
Earlier this year, the government last month had extended the lower import duty structure for palm, soybean and sunflower oils by a year till March 31, 2025, which the industry had stated would adversely impact processing and prices of domestic oilseeds.
Currently, crude palm, soybean and sunflower oil imports attract only a 5% agri infra cess and a 10% education cess, resulting in a total tax incidence of 5.5%.
Because of record imports, the domestic prices of edible oil varieties such as mustard and soybean have been impacted.
Mustard oil and refined oil prices dropped sharply by 18% and 21% respectively in February, 2024 on year while overall inflation in oils and fats category declined by 13.97%.
Source Link : https://www.financialexpress.com/policy/economy-edible-oil-imports-falls-21-since-november-3424528/
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