Vegetable oil imports down 8% to 0.7 mt

Written by feBureau | New Delhi | Updated: Mar 17 2010, 02:36am hrs
India's vegetable oil imports in February fell 8% to 700,769 tonne from a year ago as higher purchases in the previous months pushed up port stocks, the Solvent Extractors Association of India (SEA) said on Monday.

Importswhich were at 762,544 tonne in February last yearwere, however, up 6.9% in the first four months of the oil year that began in November at 3.1 million tonne, the SEA data showed.

Appreciation of rupee vis-a-vis dollar and zero import duty on crude vegetable oil and marginal duty on refined vegetable oils encouraged import during peak crushing season in India, SEA said. Experts feel that though month-on-month imports of vegetable oils has slowed down, but overall the country could end up importing almost 10 million tonne of vegetable oils in 2009-10 because of low local oilseed production.

Imports till March will be low as domestic oilseed crushing goes on, but after that we expect a strong rise in imports, a leading edible oil trader based out of Indore said.

India, the world's top vegetable oil importer, buys mainly palm oils from Indonesia and Malaysia and a small quantity of soyaoil from Argentina and Brazil. The country had bought 2.9 million tonne during November-February a year earlier.

Benchmark May crude palm oil futures on the Bursa Malaysia Derivatives Exchange on Monday dropped 25 ringgit to 2,624 ringgit ($733.1) on weaker markets, although strong export data capped losses. Edible oil imports in February fell 8% to 671,293 tonne from 730,094 tonne a year earlier, and were down 19% from 827,182 tonne from January, in line with trade expectation.

Traders had expected the country's edible oil imports to fall 18% in February from previous month as the start of the local rapeseed harvest drove domestic prices below import costs.

The fall in February edible oil imports reversed the trend of rising imports since November.

The monthly imports were lower due to excessive imports in the first quarter and large stocks at ports, said BV Mehta, executive director of the trade body. Vegetable oil imports in February included 29,476 tonne of industrial oils, such as palm fatty acid distillate, down 9.2% from a year earlier.