Vegetable oil imports up by 35 pc to 8.96 lakh tonnes in May.

NEW DELHI: India's vegetable oil imports rose by 35 per cent to 8,96,921 tonnes in May this year from 6,64,133 tonnes in the year-ago period, according to the industry data released today.

Excessive imports during the peak crushing season has led to a record stock of 16.90 lakh tonnes at ports and in the pipeline, which is nearly equal to 40 days requirement, Solvent Extractors Association of India (SEA) said.

The quantity of edible oils imported in May 2012 stood at 8,83,410 tonnes, while that of non-edible oils was 13,511 tonnes in the same period, it said.

In the first seven months of the current oil year, imports rose by 31 per cent to 56,11,884 tonnes as against 42,67,674 tonnes in the November-May period of the 2010-11 oil year.

Oil year starts from November and ends in October. SEA said current stock of edible oils as on June 1, 2012, in the country is equivalent to 40 days requirement.

"Total stock, both at ports and in pipelines has increased by 1,35,000 tonnes to 16,90,000 tonnes equal to 40 days consumption requirements," it added.

The association said import of refined palm oil will increase further on account of the Indonesian duty structure and decreasing gap in prices of crude palm oil (CPO) and refined palm oil (RBD palmolein).

"Share of RBD palmolein is likely to increase as current Indonesian inverted duty structure encourages larger export of refined oils (9 per cent export duty) over crude oil (18 per export duty)," it pointed out.

The price gap between CPO and RBD Palmolein has further reduced to just USD 19 which was USD 74 a year back, discouraging local refining, it said.

During November-May period of the 2011-12 oil year, imports of RBD palmolein rose by 97 per cent to 10,84,933 tonnes compared to 5,51,327 tonnes in the year-ago period, SEA added.

India imports about 50 per cent of domestic requirement of vegetable oil. The country imports palm oil from Indonesia and Malaysia, while soyabean oil is imported from Brazil and Argentina.

Over 8.67 million tonnes of vegetable oils were imported in 2010-11 oil year. At present, there is zero duty on imports of crude edible oils, while import of refined edible oils attracts 7.5 per cent custom duty.

Source : economictimes.indiatimes.com