KUALA LUMPUR, July 31 (Reuters) - Indian Farm Minister Ajit Singh saidon Wednesday the situation in many drought-hit areas has worsened butthere was no cause for alarm because the country had enough grains stocks.He also ruled out a cut in customs duties on edible oils."There is no logical reason to reduce customs duties on edible oilsbecause of the drought. We have been importing edible oils at this ratelast year also," Singh said."I think the bull market is here. South American soyoil is beingoffered at $455 a tonne FOB, while olein is cheaper at $425. People shouldbuy palm oil," he added."India has been in the market for a while, buying between 30,000 and40,000 tonnes of oil in a single day. Pakistani and European buyers arealso active," said one dealer.India currently imposes a basic import duty of 85 percent on refinedoils, 65 percent on crude palm oil and 45 percent on soybean oil. Itimports nearly half of its annual oil requirement of about 10 milliontonnes from countries such as Malaysia, Indonesia, Argentina and Brazil.Traders said though India was likely to see a drop in oilseed outputthis year due to poor rains in key growing areas, any sharp rise inimports would be visible only after fresh domestic oil arrivals inNovember-December.They expect the oilseed output in the current winter crop, harvestedin October-November, could fall by 15-20 percent from 12 million tonnes inthe same season a year earlier.