Palm oil regains momentum in India as price gap with soya widens

Palm oil is set to make a strong comeback in the Indian edible oil market, driven by its price competitiveness and rising import volumes. Speaking to CNBC-TV18, Atul Chaturvedi, Chairman of the Asian Palm Oil Alliance, said, “Palm will definitely claw back its mojo and recover whatever loss it had incurred in the past.”

According to Chaturvedi, India imported over 8,00,000 tonnes of palm oil in June and it was one of the most cost-effective options among edible oils. “Palm is now at a discount—something like $90–100—to soya,” he pointed out, adding that total edible oil imports for the month stood at about 1.5 million tonnes, with soya contributing 4,00,000–4,50,000 tonnes and sunflower oil making up the rest.

Chaturvedi also weighed in on the renewed discussions around agriculture futures trading. He strongly advocated for reopening domestic commodity exchanges, calling the earlier ban “not helpful.” “When you have something like 60% dependence on international markets, it makes no sense not to be aligned with the world,” he said.

Currently, Indian importers hedge on global platforms like KLC or Chicago, which Chaturvedi believes is a missed opportunity for domestic exchanges. “Why should we not have our Indian exchanges too? All the oil is going to be sold in the country in rupee terms,” he said.

As the regulator and government consider reintroducing agriculture futures, Chaturvedi cautioned against excessive regulation. “Too many changes can also be counterproductive, because then the liquidity in the markets would be affected,” he warned. He added that exchanges like NCDEX are capable of handling reasonable regulation and should be allowed to restart.

Tags: India, palm oil, imports, edible oil, Market