Informist, Thursday, Jul. 24, 2025

By Afra Abubacker

NEW DELHI – India is likely to import around 16 million tonnes of edible oils in the oil year 2024–25 (Nov–Oct), supported by easing prices and firm demand ahead of the festival season, Indian Vegetable Oil Producers' Association President Sudhakar Desai said. His estimate is largely in line with last year's imports of 15.9 million tonnes.

Imports had dropped in the first eight months of the current oil year owing to high global prices, fears of cheaper duty-free inflows under the South Asian Free Trade Area agreement, and market conditions that discouraged stockpiling, Desai said on the sidelines of the Indian Vegetable Oil Producers' Association conference. According to data from The Solvent Extractors' Association of India, edible oil imports during Nov–Jun fell 9% on year to 9.2 million tonnes, compared with 10.1 million tonnes a year ago.

However, Desai said imports are likely to "catch up in the coming months" as palm oil has become more affordable and the government's widening of the duty differential between crude and refined oils incentivises domestic refiners.

Of the total import projection of 16 million tonnes, palm oil may account for 9.0 million tonnes, followed by soybean oil at 4.5 million tonnes. Sunflower oil may account for the rest. With the recent correction in prices, palm oil is expected to remain the most imported edible oil.

"Earlier, when palm oil became expensive, the whole HoReCa (hotel, restaurant, and catering) sector... started using alternative oils like rice bran oil... now that reverses," Desai said. Palm oil imports during Nov–Jun were down over 24% on year at 3.25 million tonnes, SEA data showed.

Imports are also expected to rise in the coming weeks on seasonal demand. "In the eastern parts of India, Durga Puja is in early September... so the buying will peak in August," said Desai. He added that this year's festival season demand is likely to be stronger, with consumption expected to rise at least 10% as inventories are lower than last year. "This time, unlike last year, we expect at least 10% more consumption during the festival season," he said. In the oil year 2023-24, importers had stocked up early ahead of a duty hike in September.

On soybean oil imports from the US, Desai said volumes are likely to remain modest, in the range of 200,000–500,000 tonnes. "In the best case scenario, probably about half-a-million tonnes can come in from the US, but there is a catch with the US biodiesel-blending mandates... it may go back to 300,000 tonnes," he said.

Despite tightening US supply, Desai does not foresee a shortage in global availability. "Nowadays we are also importing from unconventional countries like Thailand, sometimes Iraq, sometimes Turkey... there are various avenues for bean oil emerging," he said.

On passing the benefits of reduced import duties to consumers, Desai said the impact is already visible in bulk loose oil markets, but packaged oil prices typically take longer to adjust. "Government wants very immediate action, which has happened in the loose oil... there is a lag time (in packaged oils), it can take 21-30 days," he said. Companies often hold duty-paid inventories and have forward sales commitments, which delay the full transmission of cost reductions in retail prices, he explained. End

Edited by Rajeev Pai

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