According to data from the Solvent Extractors' Association of India (SEA), India imported 1.34 lakh tonnes (lt) of RBD palmolein in January, up from 24,000 tonnes in December of the oil year November 2021-October 22, a 459 percent increase. In January 2021, India imported only 2,701 tonnes of RBD palmolein.
RBD palmolein imports increased by 459 percent in January compared to December, but crude palm oil (CPO) imports decreased by 23%. CPO imports decreased to 4.07 lt in January from 5.28 lt in December 2021, a decrease of 22.82 percent. In January 2021, India imported 7.67 lt of CPO.
With effect from December 20, SEA's Executive Director, BV Mehta, said the effective import tax on palmolein (refined palm) was decreased from 19.25 percent to 13.75 percent without a concurrent drop in import duty on CPO, reducing the effective duty difference from 11 percent to 5.5 percent. As a result, refined palmolein imports have surged at the expense of CPO, the raw material for domestic refineries.
Q1 of Oil Year
RBD palmolein imports grew to 2.16 lt in the first quarter of the oil year 2021-22, up from 15,601 tonnes the year before. CPO imports fell to 14.12 lt in the first three months of 2021-22, down from 21.05 lt the previous year.
Because of the reduced duty differential and because RBD palmolein is freely allowed at lower duty till March 31, Mehta believes a big supply of RBD palmolein of 8-9 lt will come during January-March, replacing much of the CPO. He claims there is a 6,000-8,000 dollar difference per tonne of processing.
He claimed that the rise in RBD palmolein shipments is jeopardizing the survival of domestic palm oil refiners, claiming that Indian refiners face a large duty differential, which will force them to close down the palm oil refinery unless the government takes corrective action to restore the duty differential to its previous level.
Palm oil vs Soft oils
The share of palm oil imports (including CPO and RBD palmolein) in the total edible oil basket fell to 46% in the first three months of the oil year 2021-22, down from 62% the previous year. Soft oils now account for 54% of the overall edible oil basket, up from 38% previously.
The larger import of soyabean oil during the period, according to Mehta, contributed to the increase in soft oil share. In the same time of 2020-21, India imported 12.57 lt of soyabean oil, up from 6.62 lt in the previous year.
Major Suppliers
Palm oil is primarily imported into India from Malaysia and Indonesia. Malaysia supplied India with 9.40 lt of CPO and 86,355 tonnes of RBD palmolein in the first three months of 2021-22. Indonesia came in second with 4 lt of CPO and 1.30 lt of RBD palmolein.
Argentina supplied 8.45 litres of crude soyabean degummed oil, while Brazil supplied 2.91 litres.
During that time, the country purchased 6.02 lt of crude sunflower oil from Ukraine and 88,323 tonnes from Russia.
Stock Position
The stock of edible oils at various ports was assessed to be 6.54 lt (CPO 2.30 lt, RBD palmolein 1.20 lt, degummed soyabean oil 1.50 lt, crude sunflower oil 1.50 lt, and rapeseed oil 4,000 tonnes) as of February 1, with pipeline stock at 12.08 lt.
On February 1, the overall stock climbed by 1.42 lt to 18.62 lt, up from 17.20 lt on January 1.
Import Price
In January, the CIF price of RBD palmolein was $1,490 per tonne, up from $1,375 in December. CIF prices of CPO stood at $1,510 a tonne ($1,420 a tonne), crude soyabean oil at $1,506 a tonne ($1,480 a tonne), and crude sunflower oil at $1,475 a tonne ($1,406 a tonne).
Vegoils Import
In January 2022, imports of vegetable oils (including edible and non-edible oils) totaled 12.70 lt, up from 10.96 lt in January 2021, a 16 percent increase. There were 12.51 litres of edible oils and 18,802 metric tonnes of non-edible oils in this shipment.
The total import of vegetable oils in the first quarter of Oil Year 2021-22 was 36.71 lt, up 3.2 percent from 35.56 lt in the same quarter of the previous oil year.
