India imported a record quantity of vegetable oils for delivery in July as refiners stepped up purchases of palm oil and soybean oil due to lucrative prices and ahead of an expected increase in import duties, industry and government sources told Reuters.
The increase in purchases of Palm oil by the world's largest importer of vegetable oils will help reduce stocks at major producers Indonesia and Malaysia and support benchmark prices.
Edible oil imports are expected to jump to a record 1.92 million tonnes, up nearly 26% from the previous month, according to average estimates from data shared by traders.
On an average, India has imported 1.2 million tonnes of edible oil so far in the current marketing year, which began in November 2023.
Imports of vegetable oils
Some 1.45 million tonnes have already been unloaded at various ports, including 850,000 tonnes of palm oil. A government official, who declined to be identified as he was not authorized to speak to the media, confirmed these figures. Palm oil imports in July are expected to increase by 45% from the previous month to reach 1.14 million tonnes, as indicated by traders.
“The correction in palm oil prices in May and June made it cheaper than rival oils. During this period, the refining margin in India was also healthy, prompting refiners to book for July shipments,” said Sandeep Bajoria, CEO of Sunvin Group, a vegetable oil brokerage. In addition, palm oil’s discount to soybean oil has widened compared to April, traders said.
“In addition, expectations of a tax hike in the budget have also prompted some buyers to increase purchases for July shipments,” Bajoria added. Soybean oil imports in July are expected to rise by 45% to 400,000 tonnes, the highest in 13 months.
Logistical challenges
Shipments of soybean oil from South America are taking more than six weeks to arrive. Moreover, some of the delayed shipments arrived in July. That has pushed up soybean oil imports, said Rajesh Patel, managing partner at GGN Research, an edible oils broker and trader. On the other hand, sunflower oil imports may fall to 380,000 tonnes in July. That’s 18% lower than last month’s record shipments, the data showed.
India buys palm oil mainly from Indonesia, Malaysia and Thailand, while it imports soybean oil and sunflower oil from Argentina, Brazil, Russia and Ukraine.
Source: Rajendra Jadhav | Notícias Agrícolas
