KUALA LUMPUR, June 1 — India’s vegetable oil imports are likely to surge to 1.14 million metric tonnes (MT) this month against the April-May monthly average of 865,000 MT, said Indian Vegetable Oils Producers Association (IVPA) president Sudhakar Desai said.
With the easing of lockdown provisions, the average vegetable oil import was expected to rise to about 1.3 million-1.4 million MT per month from July until September, he said in a statement issued in conjunction with an IVPA-hosted global webinar on May 29.
Desai moderated the seminar titled “Is Covid a Bull or a Bear for Veg Oils?”
He noted that the April-May period was when the country was in total lockdown, requiring inventory drawdown in the distribution chain.
He said the vegetable oil sector was expected to have a balanced demand in the next few months in line with the stabilising crude oil prices, which have shown signs of a rebound.
Although the overall situation was supportive, he said it was not very bullish.
He added that the global sunflower oil, selling at a premium of US$110 (RM475) per tonne over soybean oil, was keeping soybean prices strong while the prevailing price spreads seemed attractive for crude palm oil.
Patanjali Ayurved co-founder Swami Ramdev Ji, who is the chief guest at the webinar, said the demand for soybean, mustard and rice bran oils were increasing.
He said coupled the expected ten-fold palm plantation increase in 10 years, India could improve its domestic oil production to reduce import dependency.
He called for mutual co-existence between all Industry players instead of mutually harming competitive measures and a reduction in import dependency such as food grains and pulses through focused efforts.
Another panellist, India’s Department of Food and Public Distribution Secretary Sudhanshu Pandey said the Indian government was keen to promote domestic cultivation of palm oil due to its high yield of four MT per hectare versus other oils where the yield was less than 400 kg per hectare.
“The government will be targeting domestic production to increase by 55 per cent by 2024-2025,” he said.
He said the Indian government estimated vegetable oil demand to reach 33.38 million tonnes by 2024-2025.
However, he said, the Indian per capita consumption was still low compared to the world average.
Meanwhile, LMC International UK chairman Dr James Fry said US shale oil companies would ramp up production only if Brent crude oil touched US$45 per barrel in the fourth quarter of 2020.
“Biofuels demand is a function of how much monitory support Indonesia can allocate for B40 Programme. Malaysia has withdrawn the B20 programme a few times,” he said.
He said if inventories in Malaysia moved above three million MT at the end of the year, markets could turn bearish and the premium over Brent crude would fall. — Bernama