Edible oil imports by India, the world's largest buyer, are expected to dip marginally in the three months beginning August but the share of soya oil is set to rise, a top industry official said on Wednesday.
India, which buys nearly half its annual edible oil consumption of 11 million tonnes, imports palm oil from Malaysia and Indonesia and soyaoil from Brazil and Argentina.
"We have been flooded with imports in the past months especially in July," BV Meath, executive director of the Solvent Extractors Association of India, told Reuters in an interview.
"Imports between August to October will be a little lower." Meath said the country is expected to import 1.6 million tonnes of edible oil in the quarter ending October compared with 1.7 million tonnes in the same period a year ago.
But India's soyaoil imports are likely to rise to around 550,000 tonnes during the period from 490,000 tonnes a year ago. He said the fall in imports was mainly because of purchases of around 500,000 tonnes of edible oil in July, sharply up from 292,000 tonnes in the same month last year.
"We bought more in July because international prices were lower and our crop outlook was not very bright."
India is likely to import 5.1 million tonnes of edible oil in the year to October compared with 4.4 million tonnes a year ago because of a fall in oilseed output and lower edible oil prices.
India's oilseed output fell to 22.3 million tonnes this crop year, from 23.3 million tonnes a year ago. The share of soyaoil in imports this year is expected to rise to 35 percent, from 22 percent a year ago because of competitive prices and lower customs duties.
India imposes an 80 percent import duty on crude palm oil and its fractions and 90 percent on other palm oils, including refined bleached and deodorised palm olein and RBD palm oil.
But crude soyabean oil attracts only a 45 percent customs duty because of WTO regulations. The cost differential between imported soyaoil and palm oil has been narrowing since last year.
Soyaoil is currently $90 dearer than palm oil compared with $115 last year, but preference for soyaoil is growing because of health reasons, as it is lighter oil.
Meath said India's winter oilseed crop was shaping up well after widespread rains in the past weeks. "The situation is comfortable despite lower area under oilseed crop this year," he said.
"Good rains will improve yields." India completed oilseed sowing over 15.04 million hectares by August 5 compared with 15.4 million hectares on the same day last year.
Soyabean, winter season's main oilseed crop, has been planted on 7.4 million hectares compared with 7.5 million a year ago. Groundnut has been sown on 5.02 million hectares of land compared with 5.3 million hectares.
Sowing of winter oilseeds begins with the arrival of monsoon rains in June and harvesting is done in October. Meath said winter oilseed crop output would depend on the performance of monsoon rains later this month and in September.
"By the end of September we will have an estimate of our crop and imports next year."
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