Import of Vegetable Oil down by 25% in May 2016-Solvent Extractors' Association of India

Rises by 10% in November 2015 to May 2016

The Solvent Extractors' Association of India has compiled the Import data of Vegetable Oils (edible & non-edible) for the month of May 2016. Import of vegetable oils during May, 2016 is reported at 1,024,878 tons compared to 1,371,662 tons in May, 2015, consisting of 1,004,685 tons of edible oils and 20,193 tons of non-edible oils i.e. down by 25% due to highest stock at port and pipeline and reduced demand due to summer. The overall import of vegetable oils during first seven months of the current oil year 2015-16, November 2015 - May 2016 is reported at 8,593,587 tons compared to 7,833,524 tons i.e. up by 10%.

Sharp increase in RBD Palmolein Import (107%): - The import of RBD Palmolein during the first seven months of the current oil year i.e. from November 2015 to May 2016 jumped to 15.87 lakh tons from 7.66 lakh tons (107%) replacing import of CPO and expected to increase further in the coming months. The alarming increase in import of RBD Palmolein, seriously hurting the domestic refining industry. This situation has arisen due to the fact that currently the landed cost of RBD olein (finished product) is lesser than Crude Palm Oil (CPO - raw material). Due to this situation, the domestic refining industry is facing severe crisis of under-utilization of capacity and is on the verge of closure. Presently tax on export of CPO from Indonesia/Malaysia is higher by 5% in comparison to Refined Palm Oil/Olein. This differential will keep increasing with increase in prices of Palm Oil in the origin countries. Therefore, duty differential in India has to be made variable to be in line with the differential duty prevailing in Malaysia/Indonesia and justify to increase in duty difference between crude and refined vegetable oils from 7.5% to 15%.

Stock Position at Port and in Pipelines: - Current stock of edible oils as on 1st June 2016 at various ports is estimated at 865,000 tons (CPO 270,000 tons, RBD Palmolein 250,000 tons, Degummed Soybean Oil 210,000 tons, Crude Sunflower Oil 110,000 tons and 25,000 tons of Rapeseed (Canola) Oil) and about 1,465,000 tons in pipelines. Total stock at ports and in pipelines decreased to 2,330,000 tons from 2,440,000 tons in May 2016. India's monthly requirement is about 16.5 lakh tons and operate at 30 days stock against which currently holding stock over 23.30 lakh tons equal to 42 days requirements. The overall stock as on 1st June, 2016 has decreased by 110,000 tons compared to 01 May 2015.

Import of Palm & Soft Oil Ratio: - Sharp increase in import of Soft Oils During November 2015 - May 2016, Palm Oil import has marginally decreased to 4,998,344 tons from 5,116,361 tons during the same period of last year, while, soft oils import sharply increased to 3,512,570 tons from 2,591,915 tons last year. The share of soft oils imports increased to 41% from 34% last year while, share of palm oil products down to 59% from 66%.

Average Prices and Rupee depreciation: - In last three months, due to reduction in stock of Palm Oil at origins, CIF Indian port prices of edible oils has moved upward. The difference between RBD Palmolein & CPO reduced from month to month.

Import of Non-Edible Oils: Import of Non-edible oils during November 2015 - May 2016 is reported at 82,673 tons compared to 125,248 tons during the same period last year. i.e. down by 34%. P.F.A.D., P.K.F.A.D., C.P.K.O. & RBD Palm Stearin are the major import of non-edible oils.

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