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MUMBAI: India’s palm oil imports surged to their highest in four months in December, driven by increased purchases of refined palmolein due to competitive prices, a leading trade body said on Friday.
Higher purchases by the world’s biggest importer of vegetable oils could help lower palm oil stocks in top producers Indonesia and Malaysia and support benchmark futures.
The Solvent Extractors’ Association of India (SEA) reported a 2.8% rise in December palm oil imports to 894,186 metric tons, with refined palm oil imports soaring by 47% to 251,667 tons. The negative refining margin for crude palm oil in India, coupled with lower prices offered by exporting countries for refined palm oil, made it an attractive option for buyers.
The landed cost of refined bleached deodorised (RBD) palmolein at Mumbai port was approximately $25 per ton lower than crude palm oil, dealers said. In addition to palm oil, sunflower oil imports more than doubled in December, reaching 260,850 tons, the highest in three months.
This, along with increased palm oil imports, contributed to a 12.9% month-on-month rise in India’s total vegetable oil imports to 1.31 million metric tons. Soyoil imports in December rose by 1.8% to 152,650 tons, although significantly below the average imports of 306,000 tons in the last marketing year.
Negative refining margins and a higher premium over rival oils were cited as contributing factors.
“Even in January, we could witness higher imports of refined palm oil because of lower prices. Total palm oil imports could rise above 900,000 tons,” said a Mumbai-based trader.
India sources palm oil primarily from Indonesia, Malaysia, and Thailand, while soyoil and sunflower oil imports come from Argentina, Brazil, Russia and Ukraine.