India to step up Argentine soyoil imports.

India will continue to increase its purchases of Argentine soyoil this year, helping the South American country plug the gap left by China's boycott, the Indian ambassador to Buenos Aires said on Wednesday.

Argentina is the world's biggest supplier of soybean oil, but exporters have been forced to look for new markets after top buyer China halted imports in late March in retaliation for Argentine import curbs on industrial goods.

India replaced China as the biggest market for Argentine soybean oil in April and May, a private report showed this week, and Ambassador Rengaraj Viswanathan said his country's purchases of the edible oil had trebled so far this year. "This year, we're going to import more soyoil from Argentina. This isn't just good news in the short term. It's a long-term opportunity," he told Reuters in an interview.

India imported soyoil worth $770 million between January and May, up from $221 million during the same five-month period last year, embassy figures show. Total purchases of the oil are expected to reach 1.7 million tonnes, or approximately $1.1 billion, in 2010. A year ago, India spent $606 million on Argentine soyoil. "Argentina has to cultivate this market, visit India twice a year to do marketing with importers and establish direct contacts. No one is doing that at the moment," the diplomat said.

India, the world's biggest importer of edible oils, relies heavily on palm oil imported from Indonesia and Malaysia to meet its needs, but it also buys soybean oil from Argentina and neighboring Brazil. Viswanathan said Indian demand for vegetable oil was expected to double by 2021 as the population continues to grow and as people become wealthier. Indian vegetable oil imports reached some 8 million tonnes in 2009, a figure that should grow to 17 million tonnes over the next decade, the ambassador said.

The Indian market has proved vital for Argentine exporters trying to plug a huge gap left by China, which has frozen imports since late March in a trade dispute that shows no clear signs of being resolved. Argentine President Cristina Fernandez, who is in China
this week, said on Monday the row should be resolved within days, but so far no deal has been announced.

India accounted for 44 percent of Argentine soyoil shipments in April and May, making it Argentina's top customer, according to a report published by the Buenos Aires-based consultancy Abeceb.com. China represented 46 percent of the South American nation's total sales during the same period a year ago, but just 1 percent this year. Bigger sales to Peru, Iran and Bangladesh have also helped Argentina fill the gap, the report said.

Source : IB Times