Traders Eyeing Sunflower Oil From Brazil, Argentina

High Malaysian palmolein prices are forcing Indian edible oil traders to look to sunflower oil imports from Brazil and Argentina, industry officials and traders said yesterday.

Palmolein prices, both international and local, are going up and up, B V Mehta, executive director, Solvent Extractors Association of India, said.

Therefore, buyers are looking towards sunflower oil imports from Argentina. I am told some 30,000-40,000 tonnes of sunflower oil imports have been contracted recently.

Industry officials and traders said Indonesias indefinite ban on crude palm oil exports have forced all palmolein buyers to look towards Malaysia for purchases. India, Pakistan and China are the leading palmolein importers.

 

Malaysia being the only palmolein oil supplier now, the whole pressure is on it, said Navinbhai Shah, president of the Bombay Oilseeds and Oil Exchange. Hence, Malaysian prices have gone up sharply.

Industry officials said Malaysian palmolein imports were currently quoted at $660 per tonne (FOB) compared with about $610 a tonne a fortnight ago.

Traders said palmolein is being quoted at Rs 32,200 a tonne compared with Rs 31,200 a week ago. Groundnut oil was traded at Rs 37,500 a tonne compared with about Rs 36,200 a week earlier.

Industry officials said an anticipated dip in the summer oilseeds crop was also helping domestic edible oil prices to firm.

The mustard crop is expected to be quite low this summer, Shah said.

Mehta said there had been some damage to the coming summer rapeseed crop, but its extent still had to be assessed.

Trade officials expect the countrys summer mustard crop to be 20 per cent lower than last season because of the excess humidity and moisture. India harvested about 6.5 million tonnes last summer.

The country harvests two oilseeds crops, getting the bulk of the output from the winter crop. It harvested an oilseeds crop of 24.11 million tonnes in 1996-97 (July-June) compared with an output of 22.43 million tonnes in 1995-96. Some trade officials said edible oil imports had slowed in the past month as the new oilseeds crop was expected in March.

The new crop is ahead, said C M Amla of Tracom Agencies, a New Delhi edible oil trader. Not much of imported business had taken place in the recent days. Import business is also expected to stay dull in the coming weeks. (Reuters)

Industry officials said, although edible oil prices were rising, the arrival of the new oilseed crop would prevent prices from rising sharply in the coming two months.

I dont see a sharp rise in prices in the days ahead, Amla said. The new crop arrival will certainly make an impact on domestic edible oil prices.