India's Edible Oil Imports Drop: A Market Analysis

India's edible oil imports dropped by 8% annually this February, with data from the Solvent Extractors' Association of India indicating both edible and non-edible oil imports declined compared to last year. High stock levels cushioned the decline, but palm oil's high prices could limit future imports.

India's import of edible oils fell by 8% annually to 885,561 tonnes in February, according to recent data from the Solvent Extractors' Association of India (SEA). This marks a decrease from the 958,852 tonnes recorded in February 2024. The overall import of vegetable oils, which includes both edible and non-edible oil, saw a drop of 7% to 899,565 tonnes, compared to 965,852 tonnes in the previous year. This reduction is reportedly the lowest since May 2020, during the height of the COVID-19 pandemic, as reported by SEA.

For the initial four months of the oil marketing year 2024-25, running from November 2024 to February 2025, total vegetable oil imports reached 4,807,798 tonnes, marking a 4% increase from the preceding period. The recent decline in imports is attributed to high stock levels maintained until November 2024, which have now fallen below 2 million tonnes, prompting increased purchasing interest, especially in palm oil. However, a steady rise in crude palm oil prices and their impact on landing costs in India has been observed in recent weeks.

Despite this, the SEA cautions that weak global price competitiveness could restrict Indian palm oil imports in the short term. The organization also noted a potential slowdown in vegetable oil consumption growth for 2024-25, observing a premium in palm oil prices, which resulted in reduced imports and consumption, subsequently increasing the demand for soybean and sunflower oils.

(With inputs from agencies.)