India's palm oil buying spree pushes July veg oil imports to near-record

India's vegetable oil imports rose 1.84 million metric tons in July, up 22.2% from the month before and close to the highest recorded single month of imports of 1.85 MMt in August 2023, the Solvent Extractors' Association of India or SEA said Aug. 14.

The increase was mostly due to a 37% jump in palm oil imports on month to 1.08 MMt in July, compared to 786,134 metric tons in June, according to the SEA.

This is also the highest single month of palm oil purchases by India, the world's largest vegetable oil buyer, since November 2022 when imports stood at 1.14 MMt, SEA said.

The third quarter of the marketing year 2023-24 (November-October) witnessed a 20% jump in vegetable oil imports, in anticipation of the upcoming festival season in India, SEA said, adding that the massive influx has led to congestion at India's Kandla port, causing berthing delays of 8 to 10 days.

Soybean oil imports surged to 391,791 metric tons in July from 275,700 metric tons in June, SEA data showed.

However, in first nine months of MY 2023-24, the purchase of bean oil was down by almost 20 % to 2.25 MMt against 2.824 MMt in same period a year prior.

July sunflower oil imports slumped to 366,541 metric tons from 465,647 metric tons in June. Sunflower oil buying was, however, higher over the year by almost 30% at 2.83 MMt for the November to July period of MY 2023-24 compared to 2.18 MMt a year prior.

Stocks and prices

Excessive imports in July have increased India's vegetable oil stocks at ports to 988,000 metric tons by Aug. 1, up from 713,000 metric tons a month before, SEA said.

Total vegetable oil stocks including pipeline stocks was pegged at 2.9 MMt at Aug. 1, up from 2.57 MMt a month before.

In July, refined palm olein was the cheapest of all vegetable oil imports, averaging at $949/t on CIF basis to Indian ports, followed by crude palm oil at $979/t SEA said.

Crude soybean oil price averaged at $1,054/t while crude sunflower oil was $1,043/t in July on CIF basis to Indian ports, the trade body said.

Platts, a part of S&P Global Commodity Insights, assessed crude palm oil CFR West Coast Kandla at $829/t on Aug. 13, down 2.2% from the start of the month.