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Uncertainties relating to Budget proposals and market conditions are cited as reasons for low level of import commitment.

Mumbai , April 6

A SHARP decline in vegetable oil imports was noticed in March when arrivals totalled 2.48 lakh tonnes, down from 4.2 lt in the previous month.

Uncertainties relating to Budget proposals and market conditions were cited as reasons for low level of import commitment.

According to preliminary data made available to Business Line by the industry's portal Oilmandi.com, major oils that arrived last month were crude palm oil 1.69 lt; crude palmolein 48,800 tonnes; and 20,700 tonnes of degummed soyabean oil, with the rest accounted for by small parcels of refined soyabean oil, refined palmolein and crude palm kernel oil.

With this, vegetable oil imports in the first five months beginning November 2004 of the current oil year 2004-05 aggregated 16.15 lt compared to 15.92 lt during same period previous year.

On the international front, the price picture looks hazy. Many of the market-moving developments have already been factored into prices.

Encouraged by large flow of funds and threat of rust attack on US soyabean, many players perceive an upside to the market.

According to Mr Pradip Desai of Palmtrade Services, a well-known trade

intermediary, the A B C factors - Asian rust, Biodiesel and Currency - were supposedly the prime supportive factors in an otherwise bearish scenario; but the D factor - drought in South America - came into play over the last two months to push everything else into the background.

Suggesting that the current demand-supply fundamentals hardly point to a crisis in the offing, Mr Desai argued that carry out will be much more comfortable than the dismal opening stock at the beginning of the crop season, while the demand side has not shown any remarkable sparkle.

Caution, therefore, seems to be watchword for the vegetable oil market.

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