India, the world's largest edible oil importer, raised the base importprice of crude soybean oil on Wednesday (03/03/04), a move traders saidwould firm up domestic prices and hit soybean oil imports. A FinanceMinistry notification said the price of crude soybean oil had been raisedto $710 a tonne from $643. But it left the base import price of palm oilsunchanged. Traders said that the increase in the base price of crudesoybean oil was likely to hit imports in the coming months because palmoil was cheaper. Palm oil stands to gain because the disparity in priceshas further widened with the revision of base prices.

Traders in India said refined soyabean oil was quoted around 48,000 rupeesa tonne on Wednesday (03/03/04) compared with 46,000 rupees a tonne forrefined palm oil. The prices of soybean oil is expected go up further by1,000-1,500 rupees a tonne in the domestic market after this decision.India imported around 35,500 tonnes of soyoil in January compared with301,723 tonnes of palm oils. "Now no one will book orders because of thehigher landed cost," said Govindbhai Patel, a leading edible oil importerfrom Rajkot, the hub of the country's oilseeds trade. India has forecastthe oilseeds output in 2003/04 (November-October) to jump to 24.98 milliontonnes from 15.1 million tonnes in the year-ago period. India importsnearly half its annual edible oil needs of more than 10 million tonnes. Itbuys palm oil from Malaysia and Indonesia and soybean oil from Brazil andArgentina.

REUTERS04/03/04