August 11, 2010

India to buy US$1.5-billion Argentine soyoil

To continue easing the impact of a Chinese boycott of Argentine soyoil, India will buy US$1.5 billion in Argentine soyoil in 2010, the Indian Ambassador to Buenos Aires said Monday (August 9).

Argentina is the world's biggest supplier of soyoil, but exporters have been forced to look for new markets after top buyer China halted imports in late March in retaliation for Argentine import curbs on several Chinese goods.

India replaced China as the biggest market for Argentine soyoil in April and May, according to a report by a Buenos Aires based consultancy firm last month.

"India is expected to buy US$1.5 billion in Argentine soyoil in 2010 and it could be even more. In the first six months of this year we've already imported US$1.02 billion ... Argentina is number one in soyoil in India, it makes up about 90% of our soyoil imports," Ambassador Rengaraj Viswanathan said.

Total purchases of the oil are expected to reach US$1.5 billion in 2010, a nearly 150% increase from last year, when India spent US$606 million on Argentine soyoil. In addition, India's investment in Argentina is expected to double to US$2 billion in the next three years.

"In Argentina, there are opportunities for Indian imports, exports and investment. It's an attractive market, we are optimistic about the opportunities here," Viswanathan said about India's investment in Argentina's energy, mineral and agricultural sectors.

India relies heavily on palm oil imported from Indonesia and Malaysia to meet its needs, but it also buys soyoil from Argentina and neighbouring Brazil. Its market has proved key for Argentine exporters trying to fill a huge gap left by China, which froze imports in a trade dispute that shows no clear signs of being resolved.

India accounted for 44% of Argentine soyoil shipments in April and May, making it Argentina's top customer. China represented 46% of the South American nation's total sales during the same period a year ago, but just 1% this year.