India’s refined palm oil imports dipped to zero for the second consecutive month in August this year as against 2.57 lakh tonnes imported during the same month last year, according to trade body Solvent Extractors’ Association of India (SEA).

The import restrictions placed on the refined palm oil (RBD Palmolein) has encouraged domestic processing as there has been a 23 per cent rise in crude palm oil (CPO) imports to 7,24,351 tonnes in August this year as against 5,87,329 tonnes recorded in the corresponding month last year.

SEA’s Executive Director, BV Mehta said, “It may be noted that since the RBD Palmolein has been placed under the Restricted List with effect from January 8, 2020, its imports have drastically reduced. The overall import of crude oil increased and reported at 10,502,069 tonnes compared to 9,978,952 tonnes during the same period last year. Also, the share of crude oils in overall veg oil imports has increased to 96 per cent, the highest ever from 81 per cent of last year. This is helping domestic (refining) industry to utilise the higher capacity.”

Last year Malaysia had shipped excessive RBD Palmolien to India taking the advantage of lower duty concession, the SEA noted.

However, SEA also noted that with increasing preference of consumer packs of edible oils from households there has been a rise in demand for soft oils such as sunflower and soybean oils. “It is evidenced by an increase in their import by 11 per cent and 14 per cent respectively,” Mehta stated.

The data shows during November 2019-August 2020, India imported a total of 2,789,867 tonnes of soybean oil and 2,281,636 tonnes of sunflower oil, which was recorded at 2,452,362 tonnes and 2,064,772 tonnes respectively in the same period last year.

However, overall import of vegetable oils in the same period was reported to be down by 13 per cent at 11,195,890 tonnes as compared to 12,867,486 tonnes during the same period of last year.

“The import of edible oils is reduced mainly due to demand destruction since April 2020 from Hotels Restaurants and Catering (HoReCa) segment hitting lower import, mainly of palm products,” SEA noted. The overall import during oil year 2019-20 (November-October) may witness fall in import of about 10 per cent at 134-135 lakh tonnes as against 149.1 lakh tonnes recorded last year.

Notably, on the cost front, the import cost for all the major oils has gone up from their year-ago levels. RBD Palmolein price (CIF Indian Port) was quoted at $739 per tonne, which was $571 in August last year.

Similarly, CPO prices shot up to $723 per tonne as against $534 last year. Crude soybean oil and crude sunflower oils quoted at $806 per tonne and $882 per tonne, respectively as against the $729 and $809 per tonne recorded in August last year. The currency exchange rate averaged at ₹74.64 a dollar for August 2020, as against ₹71.19 per dollar in same month last year.

However, SEA noted that in the last six months, rupee is appreciating from the highs of ₹76.17 per dollar in April 2020 to ₹74.64 a dollar in August 2020.

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