Vegetable oil imports fell to a three-year-low in February due to an inverted duty structure followed by the exporting countries such as Malaysia and Indonesia.
Imports were down 40 per cent at 5,78,975 tonnes against 9,69,175 tonnes in February last year, according to data from the Solvent Extractors’ Association. It consisted of 5,69,544 tonnes of edible oils and 9,431 tonnes of non-edible oils. The overall import of vegetable oils between November and February dropped six per cent to 34,96,807 tonnes (37,35,263 tonnes).
Exporting countries have reduced export duty on refined oils to encourage refining in their country. This has led to capacity utilisation of Indian edible oil refinery companies falling to 30 per cent in the last two years.
Before the inverted export duty imposed by Indonesia in October 2011, refined palmolein used to cost $60-80 a tonne higher than the crude palmolein. However, now the finished product, refined palmolein, is cheaper by $15-20 compared with the raw materialcrude palm oil. The import of crude palm oil in February fell to 2.69 lakh tonnes against 6.70 lakh tonnes a year ago.
Between November and February, import of refined oil was up 46 per cent at 7,05,475 tonnes (4,83,291 tonnes), while crude oil was down 14 per cent at 27,15,257 tonnes (31,63,239 tonnes).
As of March 1, edible oil stock at various ports is estimated at 4,75,000 tonnes. It consists of 2,40,000 tonnes of crude palm oil, 1,10,000 tonnes of refined palmolein, 50,000 tonnes of degummed soyabean oil, 65,000 tonnes of crude sunflower oil and 10,000 tonnes of canola rape oil and about 7,70,000 tonnes in the pipelines. Inventory – both at ports and transit – was reduced by 2,70,000 tonnes to 12,45,000 tonnes, due to lower imports in the last two months.
Non-edible oil imports in February were down 37 per cent at 9,431 tonnes (14,999 tonnes), while they were down 14 per cent at 76,075 tonnes (88,733 tonnes) in the first four months of the oil year (November to October).