NEW DELHI: Palm oil purchases by India probably rebounded from the first drop in 12 months as traders and refiners in the world’s largest buyer increased shipments to bridge a widening cooking oil shortfall.
Imports climbed 4 percent to 686,000 metric tons in January from a year earlier, according to the median of estimates from five processors and brokers compiled by Bloomberg. Overseas purchases fell 5.8 percent in December, the first decline since the end of 2014. Total vegetable oil purchases climbed 14 percent to 1.25 million tons last month. The Solvent Extractors’ Association of India releases data in the middle of the month.
India, which depends on overseas supplies to meet 70 percent of its cooking oil needs, is boosting purchases after the first back-to-back shortfall in monsoon rainfall in three decades trimmed its oilseed harvest. Rising Indian appetite for palm oil may help futures in Kuala Lumpur extend gains from a 21-month high amid dwindling supplies from Indonesia and Malaysia, the world’s top producers.
“High level of imports will continue as the Indian crop is lower and at the same time consumption is rising,” said Sandeep Bajoria, chief executive officer of Sunvin Group, a Mumbai-based broker and consultant for oil and oilseed industry. “Palm prices are reasonable to import.”
