India's veg oil imports may rise to 9.7 mn tonnes.

New Delhi: The country's vegetable oils imports are likely to grow by two per cent to 9.7 million tonnes in the 2012-13 marketing year starting October on account of widening demand-supply gap, according to a latest report.

India is estimated to import 9.5 million tonnes of vegetable oils in this marketing year (October-September). Of this, 3.4 million tonnes have already been purchased in the first five months of 2011-12.

"Given the widening gap between domestic consumption and production of vegetable oils, imports in 2012-13 will increase to 9.7 million tonnes," the US Department of Agriculture (USDA) said in its latest report.

The import forecast includes 7.6 million tonnes of palm oil, 1.1 million tonnes of soyabean oil, 1 million tonnes of sunflower oil and 10,000 tonnes of other edible oils, it said.

India imports vegetable oil from Indonesia, Malaysia and other countries.

According to the USDA, India's demand for imported oils, particularly refined edible oils, has not come down despite strong international prices and with tariff remaining unchanged since September, 2006.

While the import duty remains officially at 7.5 per cent ad-valorem, the current zero tariff on crude edible oils is encouraging traders to continue building stocks, it said.

USDA further said that domestic vegetable oil consumption is forecast to rise by 6,93,000 tonnes to 17.1 million tonnes in 2012-13 on rising population and increasing income levels.

The country's per capita edible oil consumption is however, this remains below the estimated world average of 21.6 kg, the report said, adding that palm oil will continue to be the largest consumed edible oil.

After palm oil, soy, rapeseed and peanut oils are the largest edible oil segments in the Indian market.

With regard to domestic oils production, the USDA said that local output may increase by three per cent to 7.3 million tonnes due to an expected increase in oilseeds production and larger crush of oilseeds.

Assuming normal monsoon rains and favourable growing conditions, total oilseed production in 2012-13 marketing year is likely to grow by three percent to 36.3 million tonnes.

With competition from summer planted coarse cereals and winter planted wheat, chickpea and lentils, prevailing market prices of soybean, rapeseed-mustard, and peanut in current season should encourage farmers to bring a larger area under

production, it added.

Source : financialexpress.com