Low oilseed production in 2008-09, because of uneven rains during the kharif sowing season, is taking its toll on India ?s annual edible oil imports.
According to the latest data released by the Solvent Extractors Association (SEA), India?s total vegetable oil imports doubled in May and if the pace is maintained in the next few months, the country could end up importing around 75 lakh tonne of vegetable oil in the marketing year that ends in October. Imports in the first seven months of 2008-09 have also jumped by a whopping 70%.
?The rise in import was mainly due to lower than expected domestic production of oilseeds and considerably increase in domestic consumption as global and domestic prices are ruling lower coupled with the reduction of import duty on edible oils by the government,? BV Mehta executive director, Solvent Extractors? Association of India (SEA) said.
Import is likely to continue over half a million tonne per month apart from about 1.5 lakh tonne of soft oils and expecting about 6.5 lakh to 7 lakh tonne of shipment per month during next five months, he said. Edible oil prices had touched the bottom during November/December 2008, however, they have recovered in the last few months.
But still prevailing price both in international and domestic markets are lower compared to June 2008 price, which may tempt the government to consider to impose duty in the forthcoming Budget to be presented on July 3 to check the unabated import of edible oils, and thereby encourage farmers to expand area under oilseed cultivation and raise the revenue, he added.
Vegetable oil imports during May 2009 more than doubled and is reported at 7.51 lakh tonne compared to 3.62 lakh tonne for May 2008. Overall import of vegetable oils during November 2008 to May 2009 jumped to 50.43 lakh tonne from 29.73 lakh tonne against the same period last year. Import of refined oil during the review period was reported at 7.57 lakh tonne (16%) compared to 1.12 lakh (4%) and crude veg oils was reported at 40.33 lakh tonne (84%) compared to 2,434,002 tonne (96%) against the same period last year.
Palm oil product group is dominating and their import share is over 83% of the total imports. Import of palm oil in the first seven months was reported at 39.69 lakh tonne compared to 23.02 lakh tonne and soft oil was reported at 8.22 lakh tonne compared to 2.44 lakh tonne during the same period last year.
Import of non-edible oils during the review period was reported at 2.52 lakh tonne compared to 4.27 lakh tonne during the same period last year, down by 41%, thanks to higher import & domestic refining of Crude Palm Oil (CPO), leading to better availability of Palm Fatty Acid Distillate (PFAD) & Crude Palm Stearin (CPS).