Cooking Oil Imports by India to Drop on Near Record Inventories
Cooking oil imports by India, the world’s largest palm oil buyer, probably declined for the first time in five months in April as reserves stayed near a record and summer heat curbed consumption of fried foods.
Purchases of vegetable oils, including those for industrial use, fell 24 percent to 700,000 metric tons last month from 925,334 tons a year earlier, according to the median of estimates from five processors and brokers compiled by Bloomberg. Palm oil imports gained 9 percent to 560,000 tons from 512,137 tons, the survey showed. The Solvent Extractors’ Association of India will release the data next week.
Palm oil futures in Kuala Lumpur dropped 4 percent in April, falling for a third consecutive month, as exports declined 5.6 percent, according to surveyor Societe Generale de Surveillance. World exports of seven major edible oils and fats are expected to rise on increased imports by China and India, led by higher palm oil deliveries, Oil World said May 7.
“Imports slowed because of higher stockpiles from huge purchases in the past few months and the arrival of the new rapeseed crop,” said Sandeep Bajoria, chief executive officer of the Mumbai-based broker Sunvin Group. “Local demand has been sluggish since last month because of extreme heat in the summer months that limit consumption of oily food.”
Inventories, including those at ports and in the pipeline, were 2.1 million tons at the start of April and near a record of 2.12 million tons in March, extractors’ association data showed. Cooking oil imports jumped 22 percent to 4.63 million tons in the five months through March, it said.
“Stockpiles are not moving fast enough as local off-take is slow,” Pradip Desai, managing director of Mumbai-based broker Palmtrade Services Pvt. Ltd.
Palm oil for delivery in July advanced 1.3 percent to close at 2,289 ringgit ($775) a ton on the Malaysia Derivatives Exchange in Kuala Lumpur yesterday. Futures, down 6.1 percent this year, fell to 2,230 ringgit on May 6, the lowest price since Dec. 13.
Exports from Malaysia fell 5.6 percent to 1.29 million tons last month from March, SGS said on April 30. Shipments of six vegetable oils and tallow may be 71 million tons in the 2012-2013 season from 67.5 million tons a year earlier, Oil World said on May 7.
India, the world’s biggest cooking oil consumer after China, meets more than half its demand through imports. It buys palm oil from Indonesia and Malaysia and soybean oil from the U.S., Brazil and Argentina.
“There was some delay in shipments of soybean oil from South America due to problems at the loading ports and the oil should reach India this month,” Ashok Sethia, executive director of Sethia Oils Ltd., said by phone from Kolkata. About 200,000 tons of soybean oil may arrive this month, he said.
Crude soybean oil imports probably fell to 60,000 tons in April from 216,509 tons a year earlier, while sunflower oil purchases may have declined 46 percent to 70,000 tons from 129,538 tons, the survey showed.
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