In August, India’s palm oil imports surged 84% m-o-m to 850,000 tonnes, up from 465,600 tonnes, marking the largest monthly purchase of palm oil in the 2020/21 marketing year (MY) (Nov’20 – Oct’21). Some market participants estimate that the figure may have even been close to 875,000 tonnes.
Imports surged on the back of lower import duties (which will run through till the end of September 2021), as well as the need to replenish historically low stock levels due to weaker imports over the past few months. The 850,000-tonne imported quantity remains close to the five-year average of 835,000 tonnes, emphasising just how weak imports were during the previous months, despite the big increase seen during August. The removal of refined palm oil and olein restrictions until the end of the year also supported import volumes during August.
In terms of a specific breakdown, Indian buyers imported 600,000 tonnes of Crude Palm Oil (CPO) in August, with imports of Refined Bleached and Deodorised (RBD) palm oil reaching 170,000 tonnes, up significantly from the 14,000 tonnes of RBD imported in July 2021. Inedible processed palm products and palm kernel oils accounted for the remainder of the 850,000-tonne total.
With festivals such as Diwali and Dussehra around the corner in October, palm oil imports for edible purposes will likely rise further to meet demand, likely causing prices to remain firm over the corresponding period.