Surge in South American Soybean Oil Imports Reshapes Indian Market

India's palm oil imports saw a significant decline in December due to an increase in competitively priced soybean oil imports from South America, which more than doubled compared to the previous year. The shift in market dynamics has caused palm oil's share to drop significantly.

In a significant shift in India's edible oil market, palm oil imports saw a sharp decline in December as cheaper soybean oil from South America gained prominence. Industry data released on Tuesday revealed that soybean oil imports more than doubled, soaring to 420,000 tonnes compared to 152,650 tonnes the previous year.

The change has been attributed to tighter Malaysian palm oil export supplies, leading consumers to opt for more economically attractive South American soybean oil. B V Mehta, Executive Director of the Solvent Extractors' Association of India, stated that large price discounts are driving the rapid absorption of surplus soybean oil, easing the demand for palm oil.

Consequently, the market share of palm oil fell to 42% in December 2024, with refined oils such as soybean and sunflower oil comprising 58% of imports. Crude palm oil imports plunged by 47.32%, while RBD palmolein and crude palm kernel oil imports also saw significant reductions. Meanwhile, sunflower oil imports experienced a modest increase.

(With inputs from agencies.)