India's annual palm oil imports to fall behind soft oils for first time, industry official says

Patanjali Foods

24/02/2025 04:58

By Rajendra Jadhav and Ashley Tang
       KUALA LUMPUR, Feb 24 (Reuters) - Palm oil's share of
India's annual edible oil imports is set to drop below soft oils
for the first time as its rising premium over soyoil and
sunflower oil pushes refiners toward more affordable
alternatives, the head of an industry body said.
    Lower palm oil imports by India, the world's biggest buyer
of vegetable oils, could weigh on benchmark Malaysian palm oil
prices  FCPOc3  and support U.S. soyoil futures  Boc2 .
    "Palm oil is getting pricey due to supply issues, so buyers
are naturally shifting to soyoil and sunflower oil instead,"
said Sanjeev Asthana, president of the Solvent Extractors'
Association of India (SEA), in an interview with Reuters.
    The country's palm oil imports in the 2024/25 marketing year
ending in October 2025 could fall to as low as 7.5 million
metric tons, the lowest in five years, said Asthana, who is also
the CEO of Patanjali Foods Ltd  PAFO.NS .
    Palm oil is losing market share to soft oils, which are
projected to account for a slightly larger volume of imports, he
said.
    Palm oil accounted for 56% of India's total edible oil
imports in the last marketing year, but in the first three
months of the current year its share fell to 43%, the SEA data
showed.
    Palm oil has been trading at a premium over rival oils for
the past few months as supplies from top producers Indonesia and
Malaysia were affected by floods at a time when Jakarta has also
moved to increase the tropical oil's use in biodiesel.
    The current premium for palm oil is not sustainable, and
once it begins trading at a discount, likely within two months,
Indian buyers will increase their imports, Asthana said.
    Soyoil imports in the current year could increase by 1
million to 1.5 million tons from last year's 3.4 million tons,
while sunflower oil imports may rise slightly from last year's
record level of 3.5 million tons, he said.
    India meets nearly two-thirds of its vegetable oil demand
through foreign sourcing. It buys palm oil from Indonesia,
Malaysia and Thailand, while soyoil and sunoil come from
Argentina, Brazil, Russia and Ukraine.
    The rising availability of local oils, which will help
fulfill incremental demand, is expected to keep the country's
total edible oil imports steady at around 16 million tons this
year, Asthana said.

 (Reporting by Rajendra Jadhav and Ashley Tang; Editing by Jamie
Freed)
 ((rajendra.jadhav@thomsonreuters.com; Reuters Messaging:
x.com/Rajendra1857))