Imports of vegetable oil increased 28% in March 2009 due to poor kharif crop as well as holding up of stocks by farmers anticipating for the increase in prices.
As per the news published by Business Line, the imports of vegetable oil in March 2009 rose 28% as compared to March 2008. However, the pace of shipment in India was slower than the last three months (Dec 08-Feb 09).
The SEA (Solvent Extractors Association of India) revealed that the imports of vegetable oil climbed up to 6.41 Lakh Tonnes, which includes 6.09 Lakh Tonnes for edible uses, as compared to the imports of 5.02 Lakh Tonnes in March 2008. Earlier, an increase of 144%, 73% and 48% were recorded in December 2008, January 2009 and February 2009 respectively. The shipments surged to almost 9 Lakh Tonnes in January 2009.
The increase in vegetable oil imports is mainly on account of reduced production of domestic oil as a result of lower kharif crop. Moreover, the freshly harvested rapeseed/mustard crop is only partially marketed as farmers are waiting for rise in price. Consequently, the imports have risen to record levels. In the meantime, prices have kept lower because of zero customs duty; thereby, leading to substantial rise in consumption.
The Association stated, "It is surprising that import is rising month to month in spite of huge stocks at Indian ports and in pipe line, also ignoring price rise in the last three months in the international market."
India chiefly imports RBD palmolein, crude soybean oil, crude sunflower oil and crude palm oil from other countries. The statistics given by SEA suggest that the prices of crude sunflower oil and soybean oil were lower in March as compared to the first two months of 2009. The Association repeated its allegations that RBD palmolein, whose imports are rising at a faster pace, is used for the adulteration of domestic oils like groundnut oil.
According to a Research Analyst at RNCOS, "The rapidly rising RBD Palmolein imports have centered attention at worries that it is primarily used for unethical blending with other domestic oils. The reason for increasing imports of Palmolein oil is its low prices in the market. If this ill-practice is not stopped soon, then imports of RBD palmolein will surge further in the coming times; thereby, impacting the local refiners and crushers."
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