Palm oil imports by India, the world’s biggest buyer, slumped for a third month in March as the highest prices in 18 months reduced appeal of the tropical oil used in everything from candies to noodles.
Purchases of crude and refined palm oils declined 23 percent to 537,077 metric tons from a year earlier, the Solvent Extractors’ Association of India said in an e-mailed statement today. That compared with the median estimate for a drop to 526,000 tons in a Bloomberg survey. Total imports, including for industrial use, retreated 6 percent to 835,424 tons last month, the association said.
Futures in Kuala Lumpur jumped to the highest since September 2012 last month on concern that dry weather in Malaysia and Indonesia, the top producers, would cut output later this year. Declining Indian imports may expand stockpiles in Malaysia, which unexpectedly climbed last month as output increased and exports tumbled.
“Indian refiners preferred to import crude soft oils over crude palm oils due to price disparity in processing,” said B.V. Mehta, executive director of the association. Crude soybean oil imports jumped to 189,150 tons in March from 46,990 tons a year earlier, while sunflower oil purchases rose 8 percent to 97,900 tons, the association said.
Palm oil’s discount to soybean oil narrowed to an average $78.68 a ton this year from an average of $243.97 in 2013, according to data compiled by Bloomberg. Futures traded 1.1 percent higher at 2,665 ringgit a ton at 4:22 p.m. in Kuala Lumpur today.
Cooking oil stockpiles at ports and scheduled shipments slid to 1.20 million tons on April 1 from 1.25 million tons a month earlier, data showed. India’s total cooking oil imports dropped 6 percent to 4.33 million tons in the five months ended March, the association said.
India imports more than 50 percent of its cooking oil demand, shipping palm from Indonesia and Malaysia, and soybean oil from the U.S., Brazil and Argentina.