A sharp drop in domestic prices in August boosted demand for edible oil, leading to an increase in imports.
Data compiled by Solvent Extractors’ Association of India (SEA) showed that India imported 18.52 lakh tonnes (lt) of edible oil in August, against 13.75 lt a year ago, registering a growth of 34.69 per cent. India imported 17.55 lt of edible oil in July 2023.
India imported 139.74 lt of edible oil during November-August of the oil year 2022-23, against 110.70 lt in the corresponding period of 2021-22, recording a growth of 26.23 per cent.
With the import of vegetable oils, including edible and non-edible oils, touching 141.21 lt during the first 10 months of 2022-23, BV Mehta, Executive Director of SEA, said there could be a record import of over 165 lt during the current oil year ending in October. India’s highest import ever was 151 lt in 2016-17.
Stating that there was a surge in import of edible oil during August, Mehta said a sharp drop in domestic edible oil prices reignited demand, despite ample availability in the domestic market.
He said crude palm oil (CPO) imports rebounded, regaining competitiveness against soyabean and other oils, totalling 8.24 lt in August, slightly down from 8.41 lt in July.
Meanwhile, RBD palmolien imports increased from 2.17 lt in July to 2.83 lt in August. In total, palm product imports reached 11.28 lt in August, up from 10.86 lt in July.
He said soyabean oil imports rose to 3.58 lt in August against 3.42 lt in July, while sunflower oil imports increased to 3.66 lt in August from 3.27 lt the previous month.
Mehta said the surge in imports is driven by the currently low 5.5 per cent duty on CPO, soyabean oil, and sunflower oil, transforming India into a prime destination for excess oil supplies.
Following the huge import of edible oils during August, domestic stock has increased at the ports and in pipeline. The stock of edible oils at various ports is provisionally estimated at 14.64 lt as on September 1. This includes 5.53 lt of CPO, 2.32 lt of RBD palmolein, 3.83 lt of degummed soyabean oil, and 2.96 lt of crude sunflower oil. Apart from this, India had pipeline stock of 22.71 lt. The total stock stood at 37.35 lt as on September 1, as against 32.85 lt on August 1.
Palm imports up
He said the import of palm products increased sharply to 82.46 lt during November-August of the oil year 2022-23 due to price parity, as against 58.56 lt in the corresponding period of 2021-22. Shipment of sunflower and soyabean oils has gone up significantly in the last five months of the oil year 2022-23, he said.
He said there has been an increase in the import of RBD palmolein, with the share of overall refined oils (RBD palmolein) touching 14 per cent (19.24 lt) in the total edible oil imports during the first 10 months of 2022-23. It was 5 per cent (6.86 lt) in 2020-21, and 3 per cent (4.21 lt) in 2019-20. This is seriously affecting the domestic palm oil refining industry, he said.
Meanwhile, import of crude oil rose to 120.50 lt in the first 10 months of the oil year 2022-23, against 97.24 lt a year ago.
During November-August 2022-23, Indonesia supplied 31.27 lt of CPO and 15.93 lt of RBD palmolein, followed by Malaysia at 21.49 lt of CPO and 2.97 lt of RBD palmolein. Thailand supplied 6.71 lt of CPO and 11,499 tonnes of RBD palmolein.
In the case of crude soyabean degummed oil, India imported 16.88 lt from Argentina, and 12.13 lt from Brazil. During the period, Russia supplied 8.21 lt of crude sunflower oil, followed by Ukraine at 4.87lt, and Argentina at 3.57 lt.