India Edible Oil Imports May Rise as Dry Weather Reduces Sowing

by Dave

Bloomberg.com: India & Pakistan

India, the world’s biggest buyer of vegetable oils after China, may import more cooking oil in the year starting November as dry weather reduced monsoon sowing of peanuts, sunflower and sesame seeds.

Purchases may increase by at least 500,000 metric tons from 5.1 million tons this crop year ending Oct. 31, said Govindlal G. Patel, director of Dipak Enterprises, in an interview. Patel, 69, has been trading the commodity for more than four decades.

India imports more than 85 percent of its edible oil in the form of palm oil for use in curries and fried foods. Prices of palm oil have tumbled 44 percent from a March record of 4,486 ringgit ($1,303) a ton, cutting import costs for the South Asian nation that’s battling the fastest inflation in 16 years.

Farmers planted peanuts on 5.03 million hectares, 2.3 percent less from a year ago as of Aug. 28, the farm ministry said. The area for sunflower seeds fell by 30 percent to 495,000 hectares, and for sesame by 9 percent to 1.36 million hectares. The seeds yield more oil when crushed than soybeans.

Even if there’s an increase in oilseed production, the oil availability will be less as most of the increase in area is in seeds that bear less oil,” Patel said by telephone from Rajkot in Gujarat state. Most of the imports, which have also increased because of lower mustard seed output, will arrive between November and February, he said.

Edible oil imports jumped 10 percent to 3.63 million tons in the nine months ended July from 3.3 million tons in the year ago period, according to the Solvent Extractors’ Association of India. Palm oil made up 88 percent of total purchases.

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