KOLKATA: India may need to import an additional 2.2 million tonnes (mt) of cooking oil in the 2008-09 oil year (October-November) over and above last year’s import of 6.3 mt. This is estimated to meet the country’s rising demand for cooking oils, which is likely to grow 14% to 14.8 mt this year.
However, the industry feels that imports may fall short of projections if edible oil imports in crude form are once again brought under the duty net.
To check prices of edible oil, which are on the upswing under pressure from growing internal demand and a heated global market, the erstwhile UPA government had waived import duty on crude edible oils.
Projecting the country’s import requirements, industry expert Dorab E Mistry, a director of Godrej International Ltd, said monthly imports of vegetable oils in the next five months to October are expected to be in the region of 6.5 lakh tonne to 7.5 lakh tonne, if not more. If that happens, the current year may end up with a staggering 8.2-8.5 mt of imports.
However, he cautioned, if the newly elected government imposes an import duty of 10-20% on crude vegetable oils, consisting mainly of crude palm oil and degummed soyabean oil, it will push up domestic prices. Since India is very price elastic market, it will put pressure on domestic consumption and eventually bring down import requirements, he said.
India’s demand for imported oils would escalate this year due to drop in its supply from domestic sources, which is estimated at 6.6 mt against 7.14 mt last year. Of this, exports are anticipated to remain within a limit of one lakh tonne.
Anyway, as oilseed farmers fetched healthy prices this year, due to recovery in world oil prices, it will give a good impetus to oilseed cultivation in the coming kharif season. Oils from this cultivation will land in the market in the 2009-10 oil season.
Source : The Economic Times