Edible oil prices dip following weak trend globally

Prices of imported edible oil have declined over the past couple of weeks following weak trends in the global markets. Prices of select domestic edible oils have also come down in line with imported edible oil prices.

In Gujarat markets, palm oil has witnessed the sharpest fall, with prices declining by nearly Rs 200 per 15 kg to touch Rs. 825 today—down from Rs. 1,025 per 15 kg a month ago.

Similarly, soybean oil prices have dipped by Rs 100 per 15 kg at Rs 1,080 to Rs. 1,090. Prices of other domestic oils such as cottonseed oil and sunflower oils have also come down following subdued trend in the imported edible oil prices, said Suresh Shah, vice-president, Ahmedabad Oil Merchants' Association.

Recently, cottonseed prices witnessed a fall of Rs 125 per 15 kg. The prices are currently hovering at Rs. 1,025 per 15 kg, which stood at Rs. 1,150 month ago.

Sunflower oil prices in Ahmedabad markets too have declined to Rs. 1,130 per 15 liter tin from Rs. 1,225 to Rs. 1,250, which shows a dip of Rs. 100 during the month of August. Mustard, corn and groundnut oils have also seen a marginal fall in the range of Rs. 30 to Rs. 80 per tin, he added.

Market players attribute lower global prices for recent decline in the edible oil prices in the domestic market. Edible oil prices in the international markets have nosedived by nearly 30 per cent in past one month.

International price of palm oil have come down to $ 920 a tonne from earlier level of 1,250 per tonne, while that of soybean oil has diped from $ 1,575 to $ 1,200 per tonne now.

"Malaysia and Indonesia have excess stock of palm oils and they are getting agressive to offload the additional stocks, which has resulted into lower price level of edible oil in the global markets," said Narottam Tanna, a leading edible oil merchant in Ahmedabad. Crude prices have also eased comparatively in recent times, which has resulted into lower import cost, he added.

However, oil merchants expressed concerned over lack of buying interest in the domestic markets.

Despite festive season, the offtake was poor and still there is not much demand in the market, said Pratap Chandan, president, Federation of Gujarat State Edible Oil Merchants' Associations.