India Feb veg oil monthly imports drop to lowest since May 2020 as palm purchase plummets

India's vegetable oil imports in February 2025 fell to 899,565 mt—the lowest monthly level since May 2020, when imports dropped to 720,976 mt due to the COVID-19 pandemic, according to data released by the Solvent Extractors' Association of India (SEA).

The total vegetable oil purchase in February represents a 7% decline from the 965,852 mt imported in February 2024, with edible oil imports totaling 885,561 mt and non-edible oils at 14,004 mt.

Despite the sharp decline in February, total vegetable oil imports for the first four months of the 2024-25 oil year (November 2024–February 2025) reached 4.81 million mt, up 4% from 4.64 million mt in the same period last year. However, the recent drop in imports has been cushioned by high stock levels accumulated up to November 2024, which have since fallen below 2 million mt.

Soft oil shift

A key factor behind the decline in palm oil imports is weak price competitiveness in the global market.

In February, palm oil imports dropped to their lowest in four months due to unfavorable refining margins, forcing Indian importers to pivot toward soft oils like soybean and sunflower oil.

For the November–February period, palm oil imports plummeted to 1.99 million mt from 3.04 million mt in the same period last year, a steep 34% decline. The share of palm oil sharply decreased to 43% from 66% during the period. In contrast, soft oil imports surged to 2.68 million mt from 1.57 million mt, increasing their market share to 57% from 34%.

"The rapid depletion of stocks is expected to drive increased purchases, particularly of palm oil. Over the past few weeks, crude palm oil prices have strengthened slightly relative to landed costs in the Indian market. However, weak price competitiveness in the global market may limit Indian palm oil imports in the near term," said SEA.

Soybean oil imports from Argentina accounted for the largest share at 1.03 million mt, followed by Brazil (274,423 mt) and Russia (146,347 mt).

Also, Russia led sunflower oil imports (745,027 mt), followed by Ukraine (268,090 mt) and Argentina (56,200 mt).

Falling stocks and market outlook

As of March 1, 2025, total edible oil stocks at ports and in the pipeline stood at 1.87 million mt, down from 2.18 million mt on Feb. 1—a decline of 302,000 mt.

Stocks include 220,000 mt of crude palm oil, 130,000 mt of RBD palmolein, 250,000 mt of degummed soybean oil, and 270,000 mt of crude sunflower oil.

The SEA noted that the drop in palm oil imports and higher soft oil imports are reshaping India's vegetable oil market dynamics. While high price premiums on palm oil are expected to limit imports in the near term, tightening global supply and favorable international pricing for soft oils could stabilize the market in the coming months.