India, the world’s biggest palm oil buyer, probably imported more cooking oils last month after prices had the first monthly decline since September and domestic supplies dropped, according to a Bloomberg News survey.
Purchases climbed to 700,000 metric tons in January from 691,780 tons a year earlier, according to a median estimate of four processors and brokers surveyed by Bloomberg News last week. Palm oil imports increased 8.5 percent to 555,000 tons, the survey showed. The Solvent Extractors’ Association of India is scheduled to release the monthly imports data on Feb. 15.
Rising Indian imports may help palm oil prices in Malaysia rebound after plunging 16 percent in 2011, the first annual loss in three years, on higher global supplies and weak demand due to the European debt crisis. Imports from Indonesia and Malaysia make up almost 80 percent of India’s cooking oil purchases.
“The domestic oilseed crop has not been as good as we had thought because of unseasonal rains and may be lower than estimates,” Govindlal G. Patel, a managing director at GG Patel & Nikhil Research Co., said by phone from the Indian city of Ahmedabad. “This will push up imports this year.”
Palm oil advanced as much as 1.3 percent to 3,126 ringgit ($1,042) per metric ton on the Malaysia Derivatives Exchange today, the biggest gain for a most-active contract since Jan. 3, after a survey showed that inventories in Malaysia probably declined to a five-month low in January. Futures lost 3.1 percent in January, the first drop in four months.
Soybean production in India may be 10.5 million tons in the year that began on Oct. 1, less than the 11.94 million tons estimated by the Soybean Processors Association of India, while rapeseed output may decline by as much as 1 million tons from the 7 million tons last year, said Patel, who has traded edible oils for more than four decades.
India may import 9.3 million tons of edible oils in the year ending Oct. 31, Patel said. It bought 8.4 million tons last year, according to the solvent extractors’ association. Soybean oil imports may be 50,000 tons in January, compared with 49,520 tons a year earlier, and sunflower oil purchases may drop to 90,000 tons from 117,499 tons, the survey showed.
“Imports were higher during January as domestic prices were ruling more than the international rates,” Ashok Sethia, who is on the managing committee of the Solvent Extractors’ Association of India, said by phone from Kolkata. Soybean oil prices were quoted 3,000 rupees ($61) a ton more than the imported oil as there was a shortage of inventory after farmers withheld supplies, he said.
Edible oil stockpiles at Indian ports may be about 500,000 tons at the end of January from about 450,000 tons in December, said Sandeep Bajoria, chief executive officer of Mumbai-based Sunvin Group.