India starts raising palm oil buying as prices fall below soyoil
India has started raising
palm oil
purchases after a lull of five months as a correction in prices has made the tropical oil cheaper than rival
soyoil
, encouraging refiners to place orders to replenish inventories, four dealers told Reuters.
Higher purchases by India, the world's biggest buyer of palm oil, will support benchmark
Malaysian palm oil futures
, which have fallen nearly 10% so far in 2025.
"Indians had pulled back on buying palm oil because it was too pricey. But now that it's cheaper than soyoil, refiners are placing orders," said Sandeep Bajoria, CEO of Sunvin Group, a
vegetable oil brokerage
.
Crude palm oil (CPO) is currently being offered at about $1,050 a ton, including cost, insurance and freight (CIF), in India for May delivery, compared to around $1,100 for crude soyoil, dealers said.
Indian buyers started trimming purchases from December as palm oil's premium over soyoil jumped above $100.
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India imported 1.57 million tons of palm oil from December to March. Shipments for April are expected to be around 350,000 tons, bringing the average monthly imports for the five-month period to 384,712 tons.
India imported an average of more than 750,000 tons of palm oil each month during the marketing year that ended in October 2024, said the Solvent Extractors' Association of India, which is set to publish its April import data by mid-May.
The country's palm oil imports are likely to rise above 500,000 tons in May and exceed 600,000 tons in June. From July to September, the monthly average could be more than 700,000 tons, dealers said.
Stocks in India have depleted due to lower-than-normal imports over the past five months, and now refiners need to increase imports to replenish them, said Rajesh Patel, managing partner at GGN Research, an
edible oil trader
.
India buys palm oil mainly from Indonesia and Malaysia, while it imports soyoil and sunflower oil from Argentina, Brazil, Russia and Ukraine.
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