28/09/05 KARACHI ( Daily Times) - Imports of palm olien are likely toincrease by 15 percent due to lower than expected yield of cottonseed inthe country and a surge in the prices of all sorts of oils world over,millers and traders said on Monday.

They said oil prices have compelled many countries to seek alternativeenergy, which could lead to an increase in the prices of oils. Theimporters said Pakistan has imported around 112,600 tonnes of edible oilfrom Malaysia in the first 20 days of September, up by 24,330 tonnescompared to the import figures of August for the same period. They saidoil imports would further increase in October due to increased demand andstability in prices. The local market is up and would remain bullish so wecan expect importers to cash in on the situation and import a higherquantity in coming months, Raza Ibrahim, a trader and senior member ofPakistan Vegetable Manufacturers Association (PVMA), said.

"We believe there will be an increase in import orders as we are expectinglesser yield of cottonseed this year, which is a major source of edibleoil production,"he said, adding that extraction of oil from 100 kilogramsof cottonseed was around 40 kilograms. Pakistan imports about 1.4 milliontonnes of edible oil products every year, mostly Malaysian palm oil andolein, to meet domestic demand of 1.95 million tonnes as locally producedcottonseed meets the rest of the demand. Edible oil imports cost around $700 million every year.

Ibrahim said local canola seed production had resulted in self-sufficiencyin canola seed requirements of the country and now traders are not makingfresh imports of canola seed. Local seed of synthetic types costs Rs 50per kilogram compared to the international price of Rs 180 kilogram to Rs250 kilogram.

"Similarly, local hybrid seed of canola costs Rs 150 per kilogram comparedto Rs 400 per kilogram to Rs 480 per kilogram," he added. Sarson crop isbeing cultivated on about 700,000 acres annually replacement of whichwould enhance canola acreage to about 1 million acres producing about200,000 tonnes canola oil worth Rs 7.5 billion per annum, he concluded.

"Blending ratio of 35:65 for soft and hard oil has been introduced forimproving quality of ghee and generating demand for soft oil," said Zia ulHaq, a Karachi-based importer.