August 27, 2007

 

India edible oil imports may rise despite high oilseed output
 

 

India's edible oils imports bill may balloon to INR150 billion in the next marketing year that begins November up from a projected INR120 billion in 2006/07 due to strong domestic demand and firm global prices, a senior industry executive said Friday (Aug 24).

 

"India's imports of edible oil are expected to be over 5.0 million tonnes next year despite a likely increase in oilseeds output," said B.V. Mehta, Executive Director, Solvent Extractors Association.

 

India's edible oil imports in the year that ends in October are pegged at 4.8 million tonnes.

 

He said an increase in oilseeds output does not necessarily lead to a proportional increase in production of edible oils.

 

Mehta said a large share in incremental oilseeds output in 2007/08 would be accounted for by soybean, which has an oil content of about 18 percent compared with 30 percent-40 percent in groundnut and rapeseed.

 

He said per capita consumption of edible oils in India is also on the rise that partly offsets increase in output.

 

"The price of imported oils was relatively low in the first few months of the current oil marketing year but rose up sharply in subsequent months. We are on an average paying about US$800/tonne for imported oil," he said.

 

Mehta said costlier imports are pushing up the import bill, despite a cut in import tariffs by the government.

 

Unlike the past two years when the government was disbursing large volumes of rapeseed stocks that it had procured from farmers, inventories of that commodity have now reduced significantly and this may also push up imports of edible oils in 2007/08, he added.

 

India's summer sown oilseeds output is provisionally forecast to rise to about 15 million tonnes this year from 13.15 million tonnes a year earlier, though another round of rains is crucial for the crop.

 

INR1=US$0.02446 (Aug 27)