India’s edible oil imports to increase by 15-20%
The Dollar Business Bureau
India's import bill for edible oil is expected to increase by 15-20 percent during the current oil year, from November 2015-October 2016, due a significant rise in the crude palm oil prices in the world markets and a supply shortage in domestic market.
A decline in production of edible oil in local market, and a sudden increase in demand on subdued prices over the last year, has broadened the supply deficit in India.
During the oil year 2014-15, India’s vegetable oil (edible and non-edible) imports were about 14.5 million tonnes, amounting to Rs.60,000 crore. This is expected to increase to 16 million tonnes, worth Rs.75,000 crore, by the end of October 2016.
According to the data compiled by Solvent Extractors' Association (SEA), the import of vegetable oils during the first five months of the current oil year, November 2015 and March 2016, stood at 6.27 million tonnes, worth Rs 27,990 crore.
In November last year, the crude palm oil price was about 2,100 ringgit per tonne in Malaysia, after witnessing a decline of several years’ low of 1,800 ringgit a month before. Currently, the crude palm oil is trading at 2,685 ringgit per tonne – a rise of 49 percent from the lowest level.
Prices of palm oil are likely to remain constant through this year due to lower supply from the top two producers of the world, Indonesia and Malaysia, in the wake of adverse climatic conditions. The two countries together produce 86 percent of world’s total output of palm oil.