India’s palm oil imports in December plunged toa nine-month low as a rally in prices to a 2-1/2-year high prompted refiners to increase purchases of substitute soyoil that was available at a discount, five dealers said.
Lower palm oil imports by India, the world’s biggest buyer of vegetable oils, could weight on benchmark Malaysian palm oil prices, but support U.S. soyoil futures.
Palm oil imports plunged 40% in December from the previous month to 503,000 metric tons, the lowest since March 2023, according to estimates from dealers.
Soyoil imports in December rose 3% from a month earlier to 420,000 metric tons, the highest in four months, while sunflower oil imports fell 22% to 265,000 metric tons, dealers said.
Lower imports of palm oil and sunflower oil brought down the country’s total edible oil imports in December by 25% to 1.19 million tons, the lowest in three months, according to dealers’ estimates.
Indian buyers were actively switching from palm oil to soyoil after palm oil’s premium over soyoil surged in November and December, said Rajesh Patel, managing partner at GGN Research, an edible oil trader.
Palm oil usually trades at a discount to soyoil and sunflower oil, but falling stocks have lifted its prices above rival oils, whose supplies are abundant.
Palm oil has been holding a premium of more than $100 per ton over soyoil, which will encourage Indian buyers to reduce imports also in January, said Sandeep Bajoria, CEO of Sunvin Group, a vegetable oil brokerage.
Industry body the Solvent Extractors’ Association of India is likely to publish its data on December imports by mid January.
India buys palm oil mainly from Indonesia, Malaysia and Thailand, while it imports soyoil and sunflower oil from Argentina, Brazil, Russia and Ukraine.
