India hikes import duty on M’sian CPO

KUALA LUMPUR: The Indian government has raised the import duty on Malaysian crude palm oil (CPO) to 15 per cent from 7.5 per cent previously, in order to control cheaper shipments and to support its local refiners.

Similarly, the import tax on soya and sunflower have been raised to 17.5 per cent and 12.5 per cent, respectively.

Phillip Futures Sdn Bhd Senior Derivatives Product Specialist David Ng said the move by the Indian government to hike import duty was due to the fall in the prices of oilseeds below the minimum support price.

“But, this move will dampen our exports to the India which currently stood at 2.5 million tonnes. We will likely see reduced CPO exports to India because of the increase in import tax,” he told Bernama.

It was reported on July 27, that an inter-ministerial panel headed by Finance Minister Arun Jaitley had reviewed edible oil availability in the country and discussed ways to deal with rising imports.

A committee was set up by the Indian government to look into the import duty structure and to check cheap cooking oil shipments. India imported about 14.5 million tonnes of vegetable oil from Malaysia and Indonesia, annually, to meet its domestic demand for edible oil.

Indonesia and Malaysia together, account for 85 per cent of the world’s CPO output and 91 per cent of total global palm oil exports. — Bernama