New Delhi: India’s July vegetable oil imports rose by a third from a year earlier, increasing for the first time since December 2009, on purchases to build reserves ahead of festival demand.
The world’s top importer bought 800,644 tonnes of vegetable oils, up 34% from 596,024 tonnes a year earlier, the Solvent Extractors’ Association of India said in a statement.
Traders expected a 36% rise, a Reuters survey showed last week.
“Strong overseas buying took place to build reserves before the festive season,” said Veeresh Hiremath, a senior analyst with Hyderabad-based brokerage Karvy Comtrade.
Palm oil imports rose 16% to 499,880 tonnes, while soyoil purchases more than trebled to 220,070 tonnes as premium over rival palm oil narrowed.
Higher imports by India will support the benchmark October crude palm oil futures on Bursa Malaysia’s Derivatives Exchange, which rose 0.8%, or 22 ringgit, to 2,712 ringgit ($856.6) per tonne.
The surge in soyoil imports was in line with expectations that Indian purchases would rise to $1.5 billion in 2010, 2-“ times last year’s value, as the Asian nation continues to ease the impact of a Chinese boycott of Argentine soyoil.
India’s festival season starts in August with the Muslim holy month of Ramadan and ends with the Hindu festival of Diwali in November.
India’s festival demand in August-October for vegetable oils could rise 10% to 2.25 million tonnes from a year earlier, traders surveyed by Reuters said.
India buys mainly palm oil from Indonesia, Malaysia and a small quantity of soyoil from Argentina, Brazil.
India’s vegetable oil imports for the first nine month of the current year fell by 1.0% to 6.4 million tonnes.