India palm imports drop from 10-month high on weak food demand

[NEW DELHI] Palm oil imports by top buyer India probably fell from a 10-month high as a slow recovery of the food services industry curtailed demand for the world's most-used vegetable oil.

Inbound shipments fell 11 per cent to 734,000 tonnes in August from a month earlier as traders and refiners cut back purchases after replenishing reserves in July, according to GG Patel, managing partner of GGN Research. That compares with 852,534 tonnes in August 2019.

A drop in purchases by India could boost stockpiles in top growers Indonesia and Malaysia. That may curb gains in palm oil prices that have rallied about 22 per cent so far this quarter on optimism for steadily rising demand of the tropical oil used in everything from chocolate to ice-cream and shampoo.

Palm oil consumption by restaurants and hotels suffered in India after the government imposed the world's most stringent stay-at-home rules in March to curb the spread of the coronavirus among its 1.3 billion people. The restrictions are gradually being lifted.

Soybean oil imports in August are estimated to have dropped to about 391,000 tonnes from 484,525 tonnes a month earlier, Mr Patel said, while purchases of sunflower oil fell to about 158,000 tonnes from 208,747 tonnes. India's total edible oil imports probably slumped to 1.3 million tonnes compared with 1.52 million tonnes in July, Mr Patel said.

Palm oil imports probably totalled about 800,000 tonnes in August, according to Sunvin Group, a Mumbai-based broker and industry consultant. Soyoil purchases were 410,000 tonnes while inbound shipments of sunflower oil were 160,000 tonnes, it said.

BLOOMBERG