Palm oil imports fall 28% on higher stock, weak demand

New Delhi, June 14: India’s palm oil imports fell by 27.54% to 6,57,454 tonne in May, in view of higher stock availability and sluggish summer demand, industry body Solvent Extractors Association (SEA) said on Tuesday.

India, the world’s leading vegetable oil buyer, had imported 9,07,347 tonne of palm oil in May last year. Palm oil makes up more than 65% of the country’s total vegetable oil imports. In the last few months, there has been a sharp rise in the import of cheap RBD palmolein. But last month, overseas purchase including RBD palmolein showed a decline “due to highest stock at port and pipeline and reduced demand due to summer”, SEA said in a statement.

SEA, which has been expressing concerns over rising cheap imports of RBD palmolien, said: “Due to this situation, domestic refining industry is facing severe crisis of under utilisation of capacity and is on the verge of closure.” Refined palm oil is cheaper to import because the export tax imposed on it by Indonesia/Malaysia is lower than CPO.

“Therefore, the duty differential in India has to be made variable to be in line with the differential duty prevailing in Malaysia and Indonesia and justify to increase in duty difference between crude and refined vegetable oils from 7.5% to 15%,” the SEA said.

Among palm oil products, import of RBD palmolein fell by 5% to 2,61,159 tonne in May from 2,75,150 tonne in the year-ago period. The shipments of CPO declined by 37.23% to 3,91,796 tonne from 6,24,201 tonne while import of crude palm kernel oil (CPKO) dropped by 44% to 4,499 tonne from 7,996 tonne in the said period.