India’s annual imports of palm oil to fall below the share of other competing oils for the first time

Palm oil’s share of India’s annual edible oil imports will fall below that of other competing oils for the first time as its rising premium over soy and sunflower products pushes processors toward more affordable alternatives, Sanjeev Asthana, president of the Seed Oil Association of India (SEA), told Reuters in an interview.

A drop in palm oil imports by India, the world’s biggest buyer of vegetable oils, could put pressure on benchmark Malaysian palm oil prices and support U.S. soybean oil futures.

“Palm oil is becoming more expensive due to supply issues, so buyers are naturally switching to soybean and sunflower oil,” the industry union chief said. Recall, in January, India’s palm oil imports fell by 65% month-on-month to 275.2 thousand tons, the lowest in almost 14 years.

The country’s palm oil imports for MY 2024/25 may fall to 7.5 million tons, the lowest in five years, said Asthana, who is also CEO of Patanjali Foods Ltd. According to SEA data, palm oil accounted for 56% of India’s total edible oil imports last marketing year, but its share fell to 43% in the first three months of this year.

Palm oil is losing market share in favor of soft oils, mainly sunflower and soybean oils, which are expected to account for slightly higher imports, he said. Soft oils are those that remain liquid at room temperature, whereas palm oil solidifies. Asthana said the current premium for palm oil is unsustainable and once it starts selling at a discount, probably within two months, Indian buyers will increase imports.

He said soybean oil imports this year could increase by 1-1.5 million tons from last year’s 3.4 million tons, while sunflower oil imports could also rise from last year’s record 3.5 million tons.

Asthana said the increasing availability of local oils to help meet the growing demand is expected to keep the country’s total edible oil imports at around 16 million tons this year.

Tags: India, palm oil, imports