Palm oil purchases by India probably fell in December, the first decline in 2015, as record stockpiles in the world’s largest buyer prompted traders and refiners to slow shipments.
Imports dropped 7.9 per cent to 770,000 metric tons last month from a year earlier, according to the median of estimates from five processors and brokers compiled by Bloomberg. Total vegetable oil purchases, including soybean oil climbed 21 per cent to 1.38 million tons, the survey shows. The Solvent Extractors’ Association of India releases data in the middle of the month.
Stockpiles in India surged to an all-time high last month after traders boosted imports on concern that the first back-to- back shortfall in monsoon rain in three decades will shrink the oilseed harvest and worsen a cooking oil deficit. The country, which depends on overseas supplies to meet 70 percent of its needs, will still import 1.3 million tons to 1.5 million tons of vegetable oils each month for the next year, according to Sunvin Group, a Mumbai-based broker and consultant for oil and oilseed industry.
“Higher stocks at ports and in the pipeline by the end of November kept palm oil imports lower,” said Nagaraj Meda, managing director of Hyderabad-based TransGraph Consulting.
India buys palm oil from Indonesia and Malaysia and soybean oil from the U.S., Brazil and Argentina. Vegetable oil imports may climb to a record for a second year, increasing to 15.2 million tons in the 12 months that began 1 November from 14.6 million tons, Sandeep Bajoria, chief executive officer of Sunvin Group, said last month.
“Higher imports will continue because of low production and as farmers are also not selling their crop,” Ashok Sethia, a director at Sethia Oils Ltd., said by phone from Kolkata.
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