India’s palm oil imports in August experienced a significant decline, dropping by 27% from the previous month to 791,000 metric tons. This decrease is attributed to ample existing stocks and negative refining margins, which prompted refiners to reduce their purchases of palm oil.
As the world’s largest importer of vegetable oils, India’s lower demand may lead to increased stock levels in major producing countries like Indonesia and Malaysia, potentially impacting global benchmark futures. Sandeep Bajoria, CEO of Sunvin Group, noted that July’s imports had exceeded local requirements, leading to a natural reduction in August.
The recent rise in palm oil prices has made it as expensive as soyoil, eliminating the typical price advantage palm oil holds over competing oils. The refining margin for palm oil turned negative in August, further discouraging purchases. In contrast, soyoil imports surged by 16% to 456,000 metric tons, marking the highest level in over two years.
Additionally, sunflower oil imports fell by 21% to 288,000 metric tons, contributing to a 17% overall decline in India’s total edible oil imports, which amounted to 1.53 million tons. The Indian government is reportedly considering increasing import taxes on vegetable oils to support local farmers facing lower oilseed prices.
India primarily sources palm oil from Indonesia, Malaysia, and Thailand, while soyoil and sunflower oil are imported from countries like Argentina, Brazil, Russia, and Ukraine. The Solvent Extractors’ Association of India (SEA) is expected to release detailed import data for August by mid-September.