Consequent to a 11.7 lakh tonnes surplus of palm oil in Malaysia the manufacturers in that country slashed prices to liquidate stocks. The glut in palm oil production in Malaysia, also reduced the FOB value of the palm oil from $ 400 per tonne during the month of July to $ 337 per tonne. This resulted in increased inflow of palm oil into India. The Indian market currently has a stock of 30 lakh tonnes as against the present requirement of 18 lakh tonnes. Through Chennai port alone around 25000 tonnes have entered the market.

Subsequent to the fall in the prices of the imported oil, the prices of other edible oils had crashed (compared to prices during last November): sunflower oil have come down from Rs 50 to aroundRs 34 per kg, groundnut oil from Rs 67 to Rs 42 per kg, loose groundnut oil have declined from Rs 60 to Rs 33 per kg. Further the manufacturers have also reduced the wholesale price of gingerly oil which normally would not be substituted by palm oil from Rs 60 to Rs 35 per kg. Since palm oil is an ingredient for preparing vanaspathi oil, the prices of vanaspathi oil have also come down to Rs 28 from Rs 35 per kg. As per the statistical information of the department of sugar and edible oils, the requirement of edible oil in the country during the current oil year is 8.7 million metric tonnes as against the indigenous supply of 7.3 million metric tonnes.