MARKET DEVELOPMENT
India Boosts Cooking Oil Imports as El Nino Hurts Oilseed Crops
India Boosts Cooking Oil Imports as El Nino Hurts Oilseed Crops
17/09/2015 (Bloomberg) - Cooking oil purchases by India rose in August after palm oil prices slumped to a six-year low and a dry spell hurt domestic oilseed crops.
Imports, including those for industrial use, jumped 3 percent to 1.37 million metric tons last month from a year earlier, the Solvent Extractors’ Association of India said in an e-mailed statement on Tuesday. That compares with the median estimate of 1.36 million tons in a Bloomberg survey. Overseas purchases of crude and refined palm oils totaled 810,594 tons, less than the 845,000 tons predicted in the survey. Palm imports since November are 19 percent higher than a year earlier.
Indian demand has been a bright spot for palm oil producers in Indonesia and Malaysia as they struggle with record supplies and weakening demand for the commodity as a biodiesel feedstock. Palm oil, used in everything from chocolates to cosmetics, slumped into a bear market last month as China’s economic slowdown and a rout in crude prices hurt demand and exacerbated a global glut.
“India is being used as a dumping ground for excessive supply of edible oils in the world market,” the association said. “Excessive import has put tremendous pressure on the local prices, which are at a level where Indian oilseeds-growing farmers are in distress and losing interest in oilseed crop.
India’s dependence on imported oil has increased to almost 70 percent, an “alarming situation” for the country’s food security, it said.
Monsoon rain in India is headed for the first back-to-back shortfall in three decades as the strongest El Nino in almost two-decades strengthens. Rainfall has been 16 percent below normal since June 1, according to the India Meteorological Department.
Stockpiles
Reserves at ports and in pipelines were at 2.33 million tons at the start of September, the association said.
The benchmark futures contract on Bursa Malaysia Derivatives slumped to a six-year low of 1,863 ringgit ($433) a ton on Aug. 25 and traded 1.2 percent lower at 2,166 ringgit in Kuala Lumpur on Tuesday. Futures fell 6.1 percent in August.
India meets more than half its cooking oil requirements through imports with palm oil shipped from Indonesia and Malaysia and soybean oil from the U.S., Brazil and Argentina.
Soybean oil oil imports jumped to a record 406,116 tons in August, while sunflower oil shipments totaled 102,568 tons, the association said. India also imported 45,294 tons of canola oil, it said.
Imports, including those for industrial use, jumped 3 percent to 1.37 million metric tons last month from a year earlier, the Solvent Extractors’ Association of India said in an e-mailed statement on Tuesday. That compares with the median estimate of 1.36 million tons in a Bloomberg survey. Overseas purchases of crude and refined palm oils totaled 810,594 tons, less than the 845,000 tons predicted in the survey. Palm imports since November are 19 percent higher than a year earlier.
Indian demand has been a bright spot for palm oil producers in Indonesia and Malaysia as they struggle with record supplies and weakening demand for the commodity as a biodiesel feedstock. Palm oil, used in everything from chocolates to cosmetics, slumped into a bear market last month as China’s economic slowdown and a rout in crude prices hurt demand and exacerbated a global glut.
“India is being used as a dumping ground for excessive supply of edible oils in the world market,” the association said. “Excessive import has put tremendous pressure on the local prices, which are at a level where Indian oilseeds-growing farmers are in distress and losing interest in oilseed crop.
India’s dependence on imported oil has increased to almost 70 percent, an “alarming situation” for the country’s food security, it said.
Monsoon rain in India is headed for the first back-to-back shortfall in three decades as the strongest El Nino in almost two-decades strengthens. Rainfall has been 16 percent below normal since June 1, according to the India Meteorological Department.
Stockpiles
Reserves at ports and in pipelines were at 2.33 million tons at the start of September, the association said.
The benchmark futures contract on Bursa Malaysia Derivatives slumped to a six-year low of 1,863 ringgit ($433) a ton on Aug. 25 and traded 1.2 percent lower at 2,166 ringgit in Kuala Lumpur on Tuesday. Futures fell 6.1 percent in August.
India meets more than half its cooking oil requirements through imports with palm oil shipped from Indonesia and Malaysia and soybean oil from the U.S., Brazil and Argentina.
Soybean oil oil imports jumped to a record 406,116 tons in August, while sunflower oil shipments totaled 102,568 tons, the association said. India also imported 45,294 tons of canola oil, it said.