India's veg oil imports likely to decline further in 2024-25, says SEA

India's vegetable oil imports are estimated to decline further in the 2024-25 season to 15 million metric tonnes, as favourable weather will likely boost domestic production, an industry group said.

India, the world's biggest vegetable oils importer, is estimated to have imported 16 million tonnes in the 2023-24 season that ended in October, said B V Mehta, executive director of The Solvent Extractors' Association of India. In the previous year, the country had imported 16.5 million tonnes.

"Overall, we are expecting the crop will increase by 3 to 4 million tonnes... So considering new demand, still we'll have a surplus of a million ton," Mehta told Reuters on the sidelines of the Indonesia Palm Oil Conference in Bali late on Wednesday.

 

Weather has been favourable for Indian crops this year, resulting in higher production of soybean and ground nuts, Mehta said, adding that rapeseed output was also expected to rise.

India's palm oil imports in 2023-24 were estimated to be 9.2 million tonnes, down from 9.8 million tonnes in the previous year, while sunflower oil imports were seen higher at 3.5 million tonnes, compared with 2.9 million tonnes in the prior year.

Palm oil accounts for 60 per cent of India's vegetable oils imports. However, high palm oil prices this year have made buyers shift to sunflower oil, Mehta said.

Palm oil will lose about 2 per cent to 3 per cent of its market share and soft oils will gain them because of the price discounts, Mehta said.

Malaysia's benchmark palm oil price has increased by about 30 per cent so far this year, and any further increase could also squeeze demand from the lower-income consumers, he said.

India's palm oil imports in October surged 59 per cent from a month earlier to a three-month high, as refiners boosted purchases to replenish stocks depleted by lower-than-usual imports in recent months and strong festive demand, five dealers said.