In January, according to industry group Solvent Extractors Association, India’s palm oil imports declined by 29.15 percent to 5,53,084 tonnes, but exports of RBD palmolein increased, putting pressure on domestic refineries (SEA).In January 2021, India, the world’s largest buyer of vegetable oils, purchased 7,80,741 tonnes of palm oils.
In January, the country’s total vegetable oil imports increased by 16 percent to 12.70 lakh tonnes, up from 10.96 lakh tonnes the previous month.
More than 60% of the country’s total vegetable oil imports are made up of palm oil.
The SEA claims that the reduction in the duty differential between RBD palmolein and Crude Palm Oil (CPO) has resulted in an increase in RBD palmolein imports at the expense of CPO imports.
Domestic refineries use CPO as a raw material. Any decrease in CPO imports has an impact on refineries.
The government cut the effective import duty on refined palm oil from 19.25 percent to 13.75 percent beginning in December 2021, without lowering the import duty on CPO.
Because there is a huge discrepancy of roughly Rs 6,000/8,000 per tonne of processing, SEA plans to import a substantial quantity of RBD Palmolein, to the tune of 8-9 lakh tonne, during the January-March quarter, replacing much of the CPO.
“Indian refiners face a significant discrepancy, which will force them to close the palm oil refinery unless the government takes corrective action to restore the tariff differential to its previous level,” it stated.
According to SEA data, CPO imports fell to 4.07 lakh tonnes in January this year from 7.67 lakh tonnes the previous year.
However, RBD palmolein imports jumped drastically to 1.34 lakh tonnes from 2,701 tonnes in the same period, while crude palm kernel oil (CPKO) imports increased to 11,209 tonnes from 10,204 tonnes.
Soyabean oil imports climbed dramatically to 3.91 lakh tonnes in January this year, compared to 88,667 tonnes in the same month the previous year.
Similarly, sunflower oil imports increased to 3.07 lakh tonnes from Rs 2.05 lakh tonnes during the same period.
According to the SEA, edible oil stock was expected to be 6.54 lakh tonnes as of February 1 this year, with another 12.08 lakh tonnes in the pipeline.
India imports palm oil mostly from Indonesia and Malaysia, as well as a little amount of crude soft oil, such as soyabean oil, from Argentina. Sunflower oil is mostly supplied by Ukraine and Russia.
Follow and connect with us on Facebook, LinkedIn&Twitter
