Vegetable oil imports rose by 11 percent last month to over 12 lakh tonne, edible oil industry body SEA stated on Tuesday and predicted that a rise in inward shipments of refined palm oil on customs duty cut that could affect domestic farmers and refiners.
“Import of vegetable oils (comprising edible and non-edible oils) during December 2018 is reported at 12,11,164 tonnes compared to 10,88,783 tonnes in December 2017…The overall import of vegetable oils in November to December 2018 is reported at 23,45,057 tonnes compared to 23,37,593 tonnes,” Solvent Extractors’ Association of India (SEA) said in a statement.
Edible oil imports fell to 22,19,147 tonne in November-December 2018 from 22,83,604 tonne in the corresponding period of the previous year, while import of non-edible oils rose to 1,25,910 tonne from 53,989 tonnes.
The edible oil marketing year runs from November to October.
SEA alleged the government has reduced customs duty on crude palm oil imported from Malaysia to 40 percent from 44 percent, while that on refined palmolein to 45 percent from 54 percent. Subsequently, the duty difference between crude palm oil and refined palm olein has come down to 5 percent from 10 percent.
“The reduction in the duty difference will encourage the bigger import of RBD Palmolein in coming months, detrimental to the interest of domestic oil palm cultivation and will also erode the competitiveness of domestic refiners,” the association added.
As per the SEA data, the import of refined oil (RBD Palmolein) decreased to 2,39,370 tonne during November-December 2018, compared to 2,54,286 tonne in corresponding period last year. Import of crude oil fell to 19,79,777 tonne, compared to 20,29,318 tonne in the same period last year.
In November-December 2018, the import of palm oil (both crude and refined) increased to 15,03,527 tonne, against 14,39,825 tonne in the year-ago period. However, import of soft oils (soybean, sunflower, and rapeseed) decreased to 7,15,620 tonne from 8,43,779 tonne during the same period of last year.
“The duty changes will promote Indian import demand for palm oil at the expense of soft oils. The preferential rate will put Malaysia in a position to gain market share from Indonesia,” SEA said.