Rising palm oil prices will be welcome news to local farmers considering palm cultivation.
Palm oil prices are increasing. The price, which was around Rs 100 per litre until recently, is now around Rs 110. The price has risen by about 10%, and the upward trend is expected to continue for some time.
“The Covid and the Russia-Ukraine spat pushed edible oil prices to new highs. They were then brought down by government intervention. Palm oil prices are currently rising. Palm oil is now selling for around Rs 110 per litre, up from Rs 100 previously. “The prices of sunflower oil have remained in the same range of Rs 150-160 per litre to consumers,” said P Chandra Shekara Reddy, Senior Vice President (Sales and Marketing), Freedom Healthy Cooking Oils Sales, of industry trends.
According to him, the price of palm oil will rise further. Countries that grow palm prefer to export finished products rather than crude. As a result, prices are rising. Rising palm oil prices, on the other hand, will be good news for local farmers considering palm cultivation.
According to data from the Solvent Extractors’ Association of India (SEA), imports of vegetable oils in November this year, the first month of the oil year 2022-23, reached a new high of 15.4 lakh tonne, an increase of 11% from 13.9 lakh tonne in October. Vegetable oil imports totaled 11.7 lakh tonne in November of last year.
In terms of crude palm oil (CPO), the import in November was 9.31 lakh tonne, the highest monthly total ever. 7.56 lakh tonne CPO was imported in October. Imports of refined, bleached, and deodorised palm oil (RBD) are rapidly increasing. In November, about 2.02 lakh tonne of RBD was imported, up from 1.27 lakh tonne the previous month.
Last month, crude soybean oil imports fell to 2.29 lakh tonne from 3.35 lakh tonne the previous month. Sunflower oil imports increased in November to 1.57 lakh tonne, up from 1.44 lakh tonne in October 2022.
The current import duty difference of 7.5% between CPO (5%) and RBD (12.5%), according to SEA Executive Director Dr. BV Mehta, encourages the import of refined palmolien into our country.
Palmolien imports increased 168% during the most recent oil year (November 21-October 22). The import of RBD palmolein increased by more than two lakh tonne in November 2021. According to him, the import of finished goods has a significant impact on the capacity utilisation of the palm refining industry.
The primary reason for the increase in palmolien imports is the encouragement given to their industry by exporting countries such as Malaysia and Indonesia. They have maintained high export duties on crude palm and low export duties on palmolien finished products.
The industry group favours a 15% duty difference between CPO and RBD palmolein. It wants the government to increase the import duty on RBD from 12.5% to 20%.
This would reduce refined palm oil imports while increasing crude palm oil imports. Overall imports into the country will be unaffected, and there will be no effect on edible oil inflation, he said in a statement.
