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India's palm oil imports fell by around a quarter in April compared with the previous month, marking the fifth consecutive month in which imports have remained below normal levels, as palm oil's price premium over soyoil pushed buyers towards soybean oil instead, according to five trade sources.
The decline in palm oil purchases by India — the world's biggest vegetable oil importer — is expected to weigh on Malaysian palm oil prices, while supporting US soyoil futures.
According to trade estimates, palm oil imports fell 24% month-on-month in April to 322,000 tonnes. India had imported an average of more than 750,000 tonnes of palm oil per month during the marketing year that ended in October 2024, according to the Solvent Extractors' Association of India, which is due to release its April import data by mid-May.
Sandeep Bajoria, chief executive of vegetable oil brokerage Sunvin Group, said palm oil prices had risen due to a supply shortfall, prompting price-sensitive buyers to switch to soyoil. Traders noted that soybean oil imports rose 2% in April to 363,000 tonnes, with buyers having favoured it for several months because of its lower price.
Sunflower oil imports, meanwhile, fell around 6% to 180,000 tonnes, their lowest level in seven months. The declines in palm oil and sunflower oil purchases pulled India's total edible oil imports down to 865,000 tonnes in April, down 11% from the previous month, according to trade estimates.
However, Rajesh Patel, managing partner at vegetable oil trader GGN Research, said palm oil is now trading at a discount to soyoil, which should encourage Indian buyers to increase palm oil orders for shipments from May onwards.
India buys palm oil mainly from Indonesia and Malaysia, while it sources soybean oil and sunflower oil from Argentina, Brazil, Russia and Ukraine. India's edible oil imports via Nepal totalled around 85,000 tonnes in April, down from 135,000 tonnes in March, according to GGN Research estimates.
Patel noted that more than half of Nepal's imports are effectively re-exported to the Indian market in the form of refined products, since goods from the Himalayan nation are exempt from duties under the South Asian Free Trade Area (SAFTA) agreement.
Source: Business Recorder