India’s soybean oil imports hit record high, sunflower oil imports fall

India’s soybean oil imports are projected to rise by 60% year-on-year, reaching a record high in the 2024/25 season, as refineries increase soybean purchases due to lower prices compared to competing palm oil, which is expected to hit a five-year supply low.

The anticipated increase in purchases by the world’s largest importer of vegetable oils is set to support global soybean oil prices, which have risen by 31% since the start of the year, while exerting pressure on Malaysian palm oil futures.

According to dealer estimates, India’s soybean oil imports in the 2024/25 marketing year, ending in October, are likely to climb to 5.5 million tonnes, up from 3.44 million tonnes the previous year. Meanwhile, palm oil imports are expected to fall by 13.5% compared to last year, reaching 7.8 million tonnes, the lowest since the 2019/20 season. Sunflower oil imports may also decline by 20% to 2.8 million tonnes, marking a three-year low.

Despite these shifts, the surge in soybean oil imports will drive India’s overall edible oil imports up by 1% to 16.1 million tonnes for the year.

Palm oil has been trading at a premium for much of this year, prompting buyers to switch to soybean oil, noted B.V. Mehta, executive director of the Solvent Extractors’ Association of India (SEA). Soybean oil has been both cheaper and more abundant, capturing market share from palm oil. Indian consumers, highly price-sensitive and traditionally reliant on affordable palm oil, have increasingly turned to alternatives as palm oil prices rise. Soybean oil has not only replaced palm oil but is now also substituting for canola oil, which has become more expensive due to price increases over the past two months.

Earlier reports indicated that the share of Ukrainian sunflower oil in the Indian market has grown to 23% from 12% in the 2023/24 season, though Russian oil remains the market leader with a 58% share.

Tags: sunflower oil, soybean oil, India