Home / Agriculture/ South Asia’s 2017/18 vegoil imports to hit record high on strong demand

South Asia’s 2017/18 vegoil imports to hit record high on strong demand

Comments / {{hitsCtrl.values.hits}} Views / Tuesday, 6 March 2018 00:00

Singapore (Reuters): South Asia’s edible oil imports are set to climb to an all-time high this year as lower production in the region coincides with rising consumption to drive buying of mainly palm and soybean oils from elsewhere, industry officials said.

As the region’s per capita income grows, households are able to buy more products containing vegetable oils. Ahead of a key industry conference in Kuala Lumpur next week, estimates from leading industry officials showed India, the world’s biggest vegetable oil buyer, is expected to purchase 15.5 million tons in the current marketing year to October 2018.

That would mean a 2.9% rise from 15.06 million tons imported a year earlier - the previous record - because of a decline in soybean and rapeseed production this year due to adverse weather. Imports are set to make up two-thirds of India’s edible oil demand, estimated this year at around 23 million tons.

“Our (national) soybean production was lower at around 8.3 to 8.4 million tons as against 10.6 million tons last year,” said B.V. Mehta, executive director of the Solvent Extractors’ Association of India, a Mumbai-based national edible oil trade body.

“We expect a decline in rapeseed production as well. Rapeseed farmers have shifted to other crops such as wheat and chick peas for better returns,” the official said.

Mehta estimated the country’s winter-planted rapeseed output at 6.33 million tons, compared with 6.5 million tons a year ago.

The additional demand for vegetable oils stems in large part from growing household incomes in India, Asia’s third-largest economy.

“The government has raised (import) duties to protect farmers, but we will continue to buy higher volumes because of lower domestic production and rising consumption,” said Sandeep Bajoria, chief executive of vegetable oil importer Sunvin Group. Bajoria will attend the Price Outlook Conference in Kuala Lumpur as part of the Indian delegation.

Palm oil futures traded on the Bursa Malaysia Derivative Exchange have risen 2.6% in February after declining for the last three months, driven by rising demand.

India primarily imports palm oil from Indonesia and Malaysia and soyoil from Argentina and Brazil. It also buys sunflower oil from Ukraine and canola oil from Canada.

Giving the breakdown of India’s imports, Sunvin’s Bajoria estimated the country will buy 9.8 million tons of palm oil in the current marketing year, 3.1 million tons of soybean oil, 2.3 million tons of sunflower oil and 300,000 tons of canola oil.

Neighbouring Pakistan’s edible oil purchases are forecast by Rasheed Janmohammed, former chairman of Pakistan Edible Oil Refiners Association, to climb 6.7% to a record of 3.2 million tons in 2018 from 3 million tons a year before.

But the growth in imports of edible oil is expected to be slower as the country buys more oilseeds, resulting in increased supply of domestically produced vegetable oil.

The country’s edible oil imports rose in 2017 rose 15% from 2.6 million tons in 2016.

“Pakistan is taking more soybeans and canola seeds for the local crushing industry,” said Janmohammed.

Meanwhile Bangladesh is forecast to import 2.35 million tons of mainly palm and soybean oils in 2017/18, up 9.3% from 2.15 million tons a year ago, according to the U.S. Department of Agriculture (USDA).

Sri Lanka’s vegoil purchases, mainly palm oil, are estimated to rise to 210,000 tons this year, up from 200,000 in 2016/17, according to USDA estimates.

Share This Article


1. All comments will be moderated by the Daily FT Web Editor.

2. Comments that are abusive, obscene, incendiary, defamatory or irrelevant will not be published.

3. We may remove hyperlinks within comments.

4. Kindly use a genuine email ID and provide your name.

5. Spamming the comments section under different user names may result in being blacklisted.


Today's Columnists

Fruits, flowers and futile triumphalism at Galle Face?

Wednesday, 19 December 2018

Every morning, I play voyeur and watch that nice neighbourhood uncle pluck flowers to pooja-fy his guardian deities. He is quite religious about it. And industrious to boot. The problem, of course, is that he doesn’t restrict himself to his garden.

Will Kyaukpyu overtake Gwadar and Hambantota?

Wednesday, 19 December 2018

China last month signed a $1.3 billion contract for Myanmar’s Kyaukpyu port project. The figures doing rounds in media in the run up to this port deal were as high as $7.9 billion which had ignited enormous curiosities. The Chinese had been negoti

Things to do in a Democracy when you’re dead…

Tuesday, 18 December 2018

In yesterday’s column, I argued a case for not impeaching the chief executive of the coup that has left our country situation in ruins. At the end of a pitched battle between the forces of unconstitutional ambition on one hand and democratic resist

Tweaking the New Inland Revenue Act (Part II)

Tuesday, 18 December 2018

In the backdrop where the recent amendment to the country’s supreme law is called in question, it may be appropriate to recall that the passage of the new Inland Revenue (IR) Act through Parliament was far more controversial. Nevertheless, the new

Columnists More