India’s palm oil imports hit 14-year low

India’s palm oil imports in January fell to nearly 14-year low due to higher soy oil imports driven by negative refining margins for palm oil.  The country’s edible oil imports in January declined by 15.6% to 1 million tons, the lowest in 11 months, due to a drop in palm oil shipments.

India’s palm oil imports in January have hit a 14-year low due to higher prices compared to competing oils in the international market, according to the All India Edible Oil Traders Federation.

Shankar Thakkar, President of the Federation, stated that palm oil imports dropped 46% from the previous month to 272,000 metric tons, marking the lowest level since March 2011. In the marketing year ending October 2024, India has been importing an average of over 750,000 metric tons of palm oil per month.

“Palm oil traditionally accounts for more than half of India’s total edible oil imports, but for the first time in more than a decade, its share has fallen below 30%,” Thakkar said.

India, the world’s largest buyer of vegetable oils, is importing less palm oil, which could put pressure on benchmark Malaysian palm oil prices while boosting U.S. soy oil futures. Palm oil typically trades at a discount to soy oil and sunflower oil, but declining stocks have driven its prices higher than competing oils, which remain in ample supply.

Meanwhile, soy-oil imports in January increased by 4% from the previous month to 438,000 metric tons, the highest in seven months. Sunflower oil imports also saw a rise of 9.5%, reaching 290,000 metric tons.

Due to the decline in palm oil shipments, India’s total edible oil imports fell by 15.6% in January to 1 million metric tons, the lowest in 11 months. Thakkar warned that if palm oil prices remain high, the downward trend in imports could persist in the coming months.

India primarily sources palm oil from Indonesia, Malaysia, and Thailand, while soy-oil is imported from Argentina and Brazil, and sunflower oil from Russia and Ukraine.