January 18, 2005

India's Soy Oil Imports Set To Rise On Soft Prices

India's soy oil imports are set to grow sharply this year due to lower global prices, but edible oil imports by the world's largest buyer should be below earlier estimates due to a good summer oilseeds crop, a top trade official said on Monday.

"We are slashing our estimates of oil imports by 500,000 ton because the mustard crop is shaping very well," chairman of Central Organisation of Oil Industry and Trade, Sandeep Bajoria said.

India is expected to buy only 4.5 million ton of vegetable oil this year ending in October, against earlier estimates of five million ton, Bajoria said on the sidelines of an industry meeting.

India, which imports some 40 per cent of its annual needs of 11 million ton of edible oil, is the world's fourth-largest vegetable oil producer. It imported 4.4 million ton of edible oil in the 2003-04 (November-October) oil year.

Edible oil imports were earlier estimated to grow strongly this year due to a poor winter crop after erratic monsoon rains. India's winter oilseed output, grown between June and October, fell 5.8 per cent from a year earlier to 13.1 million ton.

The June-September monsoon season usually impacts both winter and summer crops. The rainfall in 2004 was 13 per cent below normal, but rains at the end of the season in September gave the soil more moisture for summer sowings.

Bajoria said this year's volume of soft oil, mainly soy oil, was expected to grow to about 1.5 million ton from about 900,000 ton last year. Palm oil imports were estimated at three million ton, down from 3.4 million last year.