India to increase soyoil imports

India may boost imports of soyoil by 80% this year as its premium over palm oil drops amid record global production.

Purchases may jump to 1.8 million tonnes in the year ending October 31, from one million tonnes a year earlier, Govindlal G. Patel, director of vegetable oils trading company Dipak Enterprise, said. Overall edible oil imports may jump 6.7% from the previous year to 8.7 million tonnes, he said.

Higher Indian imports may support soyoil prices, which have dropped about 6% in Chicago this year on a record global soy harvest. The premium of soyoil over palm oil plunged to US$66.10 a tonne on May 13, lower than the 12-month average of US$129.30 a tonne.

''Soyoil will make up whatever increase in imports that'll be seen this year,'' Patel said. ''Soyoil is cheaper and people are taking advantage.''

Soy futures in Chicago have fallen 8% this year as global output expands to a record, led by rising production in the US, Brazil and Argentina, the world's top growers. China, the largest user of soyoil, suspended purchases from Argentina last month because of quality concerns. Argentina supplies about three-quarters of China's demand.

''India's own soy oil supply will be less than last year as nearly half the crop has not been crushed,'' Patel said. ''With China shunning Argentine supplies, it's turned cheaper for Indians.''