India's Vegetable Oil Imports Surge 37 Perent to Record High

NEW DELHI: India’s vegetable oil imports surged 37 per cent to a record in 2008/09, fuelled by higher consumption and low taxes, but imports in October, the last month of the oil year, dipped as expected. India, the world’s top vegetable oil buyer, imported 8.7 million tonnes in the year. “The current trend gives a hint that imports would touch 10 million tonnes in 2-3 years,” said B.V. Mehta, executive director of the Solvent Extractors’ Association of India. Mehta said the record imports had reduced the country’s self sufficiency as nearly half of its demand is now being met through overseas purchases.

The value of total imports, which include both edible and non-edible oils, rose 12 per cent to 280 billion rupees (100 rupees = RM7.60).

“Such huge import dependence is a cause of concern for local oilseed growers,” said Veeresh Hiremath, a senior analyst with a Hyderabad-based brokerage, Karvy Comtrade.

India’s vegetable oil imports in October fell 19 per cent to 667,276 tonnes from 826,848 tonnes a year earlier, the SEA said in its latest monthly update.

As the local soyabean crushing season began, traders had expected edible oil imports to fall an annual 23 per cent in October to 606,580 tonnes, a reversal from record monthly imports in September. The industry body said a rise in per capita consumption of cooking oil and low import taxes were the main reasons for the rise in imports.

India imposes an import duty of 7.5 per cent on refined oils.

The depreciation of the US dollar against Indian currency by about 5 per cent has also made overseas purchases cheaper.

After record imports in September, monthly edible oil imports fell 29 per cent to 615,066 tonnes in October, and were down 22 per cent from a year ago.

India, the world’s leading vegetable oil importer, buys palm oils from Indonesia, Malaysia and a small quantity of soyaoil from Argentina and Brazil. – Reuters

Source : Business Times
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