MARKET DEVELOPMENT
UPDATE 1-India\'s 2013/14 Edible Oil Imports Seen At Record-Trade Expert
UPDATE 1-India\'s 2013/14 Edible Oil Imports Seen At Record-Trade Expert
21/09/2013 (Reuters) - Edible oil imports of world's top buyer India are likely to rise 4 percent to a record 10.7 million tonnes in 2013/14 due to growth in consumption, with the entire rise on account of refined palm oil, a leading trade expert said on Friday.
Higher purchases from India could support benchmark Malaysian palm oil futures, which have fallen nearly 5 percent so far in 2013 after plunging 23 percent in 2012.
"Right now the difference between refined and crude palm oil import duty is just 5 percent. Because of the lower difference, imports of refined palm oil will go up next year," Govindbhai G. Patel, managing partner of GG Patel & Nikhil Research Co., told Reuters on the sidelines of an edible oil conference.
Total imports of edible oil in the current year ending on Oct. 31 could amount to 10.3 million tonnes, Patel added.
RBD palmolein imports are likely to jump to a record 2.8 million tonnes in 2013/14, up 21.7 percent on the previous year, Patel said. Edible oil companies in India, the world's biggest importer of palm oil, usually import CPO and process it at their port-based refineries.
In January 2013, India imposed a 2.5 percent duty on imports of CPO, effectively narrowing the duty gap between crude and refined products to 5 percent. That is encouraging importers to buy cheaper refined palm oil instead of CPO.
India's imports of refined palm oil during April to August more than doubled from a year ago to 1.2 million tonnes, forcing some local refineries to shut down.
In August, the average landed cost of CPO and refined palm oil was the same at $809 per tonne.
India's oilseed production is set to grow in 2013/14 due to ample monsoon rains, but that won't be sufficient to fulfill demand, which is rising mainly due to prosperity in rural areas.
The country's soybean production is likely to rise by as much as 18 percent to a record 13.34 million tonnes in 2013/14 from the year before as rains boost crops in key growing areas, a senior industry official said last month.
Higher rainfall is also set to help rapeseed, the country's main winter-sown oilseed crop.
"This year soybean and groundnut production is set to rise and even in the winter season I'm expecting higher plantation of rapeseed," said Patel.
India has imported 8.55 million tonnes of edible oils in the first 10 months of the marketing year that started on Nov. 1, 2012, up 7 percent compared with the same period a year ago.
Palm oil imports account for more than 75 percent of the total edible oil imports.
India's palm oil imports in the year starting Nov. 1, 2013 are likely to climb to 8.9 million tonnes from 8.7 million tonnes estimated for the current year, Patel, a former head of the Solvent Extractors' Association of India, said.
The south Asian country fulfils more than half of its edible oil requirement through imports, mainly palm oil produced in Malaysia and Indonesia.
Higher purchases from India could support benchmark Malaysian palm oil futures, which have fallen nearly 5 percent so far in 2013 after plunging 23 percent in 2012.
"Right now the difference between refined and crude palm oil import duty is just 5 percent. Because of the lower difference, imports of refined palm oil will go up next year," Govindbhai G. Patel, managing partner of GG Patel & Nikhil Research Co., told Reuters on the sidelines of an edible oil conference.
Total imports of edible oil in the current year ending on Oct. 31 could amount to 10.3 million tonnes, Patel added.
RBD palmolein imports are likely to jump to a record 2.8 million tonnes in 2013/14, up 21.7 percent on the previous year, Patel said. Edible oil companies in India, the world's biggest importer of palm oil, usually import CPO and process it at their port-based refineries.
In January 2013, India imposed a 2.5 percent duty on imports of CPO, effectively narrowing the duty gap between crude and refined products to 5 percent. That is encouraging importers to buy cheaper refined palm oil instead of CPO.
India's imports of refined palm oil during April to August more than doubled from a year ago to 1.2 million tonnes, forcing some local refineries to shut down.
In August, the average landed cost of CPO and refined palm oil was the same at $809 per tonne.
India's oilseed production is set to grow in 2013/14 due to ample monsoon rains, but that won't be sufficient to fulfill demand, which is rising mainly due to prosperity in rural areas.
The country's soybean production is likely to rise by as much as 18 percent to a record 13.34 million tonnes in 2013/14 from the year before as rains boost crops in key growing areas, a senior industry official said last month.
Higher rainfall is also set to help rapeseed, the country's main winter-sown oilseed crop.
"This year soybean and groundnut production is set to rise and even in the winter season I'm expecting higher plantation of rapeseed," said Patel.
India has imported 8.55 million tonnes of edible oils in the first 10 months of the marketing year that started on Nov. 1, 2012, up 7 percent compared with the same period a year ago.
Palm oil imports account for more than 75 percent of the total edible oil imports.
India's palm oil imports in the year starting Nov. 1, 2013 are likely to climb to 8.9 million tonnes from 8.7 million tonnes estimated for the current year, Patel, a former head of the Solvent Extractors' Association of India, said.
The south Asian country fulfils more than half of its edible oil requirement through imports, mainly palm oil produced in Malaysia and Indonesia.