The Hindu Business Line : Port stocks of vegoil barely adequate

With earlier than usual activity in the edible oils market, import volumes too have been higher. But vegoil lifting from the ports has been slow because of sluggish offtake.

WITH THE festival season round the corner, it is quite natural that edible oil imports should pick up momentum to cater to the manifold increase in consumption demand. But, strangely, this year the momentum started much earlier. Imports have been strong since April.

Between April and July, edible oil arrivals aggregated 18.5 lakh tonnes, considerably higher than the 10.7 lakh tonnes registered for the same period in 2004. As much as 80 per cent of these imports came in through the ports of Kandla (8.4 lakh tonnes); Jawaharlal Nehru (2.2 l.t.); Kolkata (2.1 l.t.); Kakinada (1.6 l.t.); and Mundra (1.5 l.t.).

For August, the preliminary estimate of import is about 5 lakh tonnes, half of which is soyabean oil.

Currently, port-based stocks of various oils are estimated at about 5.5 lakh tonnes and these are mainly at Kandla (2 l.t.) Jawaharlal Nehru (one l.t.), and Kakinada (60,000 tonnes) with the rest scattered among other ports.

The current level of port-based inventory is normal for this time of the year when imports increase and domestic stocks are low.

Commenting on the situation, Mr Dilip Kumar of Tapasya Trading Co. told Business Line that he does not see the current level of port-based stocks as unusual and that the soyabean unloaded towards the end of August is also included in the inventory.

Lifting vegetable oil from ports has been somewhat slow because of sluggish offtake in the market. Weather related uncertainties both in India and the US and lack of fresh leads to give the market a specific direction seem to hold back players. The role of price support agency NAFED, which is holding large stocks of rapeseed/mustard, is also unclear.

"I think the current stock would be barely adequate for the season," Mr Dilip Kumar said adding that during the period when India's indigenous production picks up, that is, during November-February, the port-based stock levels would decline to 3.5-4 lakh tonnes.

Indian importers use as many as 15 ports to receive vegetable oil import consignments. Smaller ports such as Tuticorin, Nagapattinam, New Mangalore and Bedi have also begun to attract the attention of receivers. Such diversification leads to saving of transportation cost by minimising cross-country movement.

As for import of non-edible or industrial oils such as crude palm stearine and palm fatty acid distillate, Mumbai port tops the list with 50 per cent share followed at a distance by Mundra and Chennai. India imports approximately three lakh tonnes of industrial oils mainly for use in the soap industry.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Air traffic set to take off in Mangalore

Air Arabia plans more flights to Mumbai

Spicejet okays preferential issue

Port stocks of vegoil barely adequate

KCCI chief on NMPT board

Kolkata port handles record throughput

Concor's major wagon acquisition plan — To spend up to Rs 1,500 cr over five years

ICD with little traffic

Secunderabad-Chennai special train