India would likely take over China’s position as the world’s largest palm oil importer by late-2010, according to Malaysian Palm Oil Board.

Speaking on the sidelines of a conference, Board chairman Sabri Ahmad
said India was interested in increasing its palm oil imports, mainly
from Malaysia and Indonesia.

India’s reluctance to reintroduce the import duty on crude palm oil
while retaining the 20% import duty on soybean, would help boost palm
oil exports to the sub-continent next year, he said.

The tax differential between CPO and soybean oil enhances the
attractiveness of CPO, which is now trading at a $200 per tone price
discount to soybean oil, he added.

India bought a record 8.66 million tones of vegetable oils as at
October this year. Last year, it imported about eight million tones of
vegetable oils, of which six million tones are palm oil.

Of the six million tones, about 1.5 million came from Malaysia and the remainder from Indonesia.

In April 2008, India removed the duties on all vegetable oils to keep prices at bay following its soaring inflation rate.

However, it imposed a 20% duty on soybean oil last November after the global prices of edible oils fell.

Prior to India’s zero import duties regime, palm oil had been slapped with a 20% import duty.

Last year, Malaysia’s palm oil exports to India surged by 89.9% to 970,734 tones from 511,157 tones a year earlier.

India used to be the largest importer of Malaysian palm oil before being replaced by China in 2002.

Malaysia last year raised its CPO export quota from 2.5 million tonnes
to 3 million tonnes to accommodate the increasing world demand and high
domestic stock level.

India imports its CPO mainly from Indonesia while from Malaysia it
imports mostly refined, bleached and deodorised palm olein (cooking
oil).Palm oil is the world’s most consumed vegetable oil.

For 2010, Malaysia is targeting a higher palm oil production of 17.7
million to 18 million tonnes while Indonesia has raised its forecast
production to 22 million to 23 million tonnes.

Source: Commodity Online

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