Import of vegetable oils, including Food According to the Solvent Extractors Association of India (SEA), non-edible oil declined 13 per cent year-on-year to around 9.12 lakh tonnes in April this year as compared to 10.53 lakh tonnes in April 2021.
Import of edible oils declined from 10,29,912 tonnes to 9,00,085 tonnes, while imports of non-edible oils declined to 11,761 tonnes from 23,435 tonnes. The oil marketing year runs from November to October.
During the first six months of the current oil marketing year (November 2021-April 2022), imports of vegetable oils increased by four per cent to 67,07,574 tonnes. “Indonesia has banned the export of palm oil with effect from April 28, 2022, which has queued the pitch and made life difficult for hapless consumers around the world,” SEA said in a statement.
Indonesia The world’s largest producer of palm oil. Last month it banned the export of palm oil. The export restriction is applicable on Refined, Bleached, Odorless (RBD) Palm Olein.
India is the largest importer of palm oil in the world and is dependent on Indonesia and Malaysia for its demand. India imports over 13.5 million tonnes of edible oil every year, of which 8-8.5 million tonnes (about 63 per cent) is palm oil. Now, about 45 percent comes from Indonesia and the rest from neighboring Malaysia. India imports around 4 million tonnes of palm oil from Indonesia every year.
India Ratings and Research has said that the ban is likely to impact both the supply and prices of edible oils globally.
The SEA said in its statement on Friday, “It is expected that Indonesia can lift the sanctions before the end of May.” However, if Indonesia continues to impose restrictions on the export of palm oil products, the situation will worsen as there is not enough supply from other origins.”
Palm oil and its derivatives are used in detergents, food products, biofuels and cosmetics. They are used in the manufacture of many daily consumption items such as shampoos, margarines, soaps, chocolates, biscuits and noodles. Therefore, any increase in palm oil prices will add to the cost of these industries. The ban on palm oil by Indonesia is affecting the prices of various products here.
“The current ban is a short-term measure to bring immediate relief from high prices and supply issues in Indonesia, and maintaining a complete ban on palm oil exports may be difficult as the country’s domestic consumption is low at around 17 million . Close to 45 million tonnes of over 40 per cent of its annual production,” India Ratings has said.
According to the United Nations Food and Agriculture Organization, vegetable oils are among a number of major food additives that have reached all-time high prices in recent weeks following Russia’s invasion of agricultural powerhouse Ukraine. Soybean oil, the second most widely used vegetable oil, rose 4.5 percent to a record high of 83.21 cents a pound on the Chicago Board of Trade.
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