08/11/2008 (Commodity Online) - Indians are consuming all the palm oil produced in Malaysia and Indonesia. India is the largest importer and consumer of edible oils in the world and the country imports nearly 3 million tons of palm oil annually mainly from Malaysia and by Indonesia.

Here are some interesting facts and figures on India's palm oil consumption:

India is dependent on palm oil imports for over 25% of its annual edible requirement. There has been a sharp rise in the imports of palm oil into the country during the post 1998 period.

Malaysia is the world's largest producer and exporter of palm oil and is producing about 50% of the world's supply of palm oil. Indonesia is the second largest world producer of palm oil producing approx 30% of world palm oil volume.

With a share of over 54% (18 million tons), palm oil dominates the global vegetable oil export trade. Palm oil is produced in different countries, but around 80% is produced by Malaysia and Indonesia. The annual produce of Malaysia totals between 11 – 12 million tons, while Indonesia with 8 – 9 million tons is second only to it. While the production has been growing at the rate of 7%, its consumption has been growing slightly faster at 7.15%.

To meet this challenge the acreage under palm plantations has been growing at the rate of about 6.47%, which is significantly higher than its competitor soybean(3.36%). Besides this Malaysian and Indonesian governments have been working in the direction of increasing the yield levels of the plantations.

Rising consumption of palm oil in India is mainly attributed to its price competitiveness among several of its competing oils is being met through increasing imports. The import is mainly through the ports of Kandla, Kakinada, Kolkata, Mangalore, Mundra, Mumbai and Chennai.

Palm oil supports many other industries in India like refining, Vanaspati and other industrial sectors apart from human consumption as RBD palmolein.

The major importing and trading centers for palm in India are Chennai, Kakinada, Mumbai and Kandla. The other centers like Mundra, Kolkata, Mangalore and Karwar also play important role, but next to the four major trading centers.

Palm oil prices in India depend on the imported palm oil from Malaysia and Indonesia at the various ports. The prices in these countries are directly reflected in the trend of the palm oil prices at Indian ports.

Besides these palm oil trade in India is influenced by the supply-demand scene in the domestic market, including the factors influencing various oilseed production in the country, prices of various domestically produced and imported oils, production and trade policies of the Government- mainly the export-import policy, over-all health of the economy that has a bearing on the purchasing power of ultimate consumers, etc.

The entire industry of CPO in India is dominated by importers, large refiners, corporate involved in wholesale and retail trade through value-addition and retail-regional level players along with a few National level players. The industry is dominated by over 200 importing Companies, who are mostly refiners too.