MUMBAI: Domestic supply of edible oils would be enough to ensure that demand is comfortably met during the first quarter of calendar year 2009.
Good reports for mustard crop and imports will be sufficient to address the incremental demand that followed a decline in edible oil prices last year, according to industry experts.
India is likely to harvest around 60-65 lakh tonne of mustard crop as against 45-50 lakh tonne last year. “This will result into release of additional refined oil in markets,” says Sandeep Bajoria, chief executive of Sunvin Group, a vegetable oil trading firm. Agrees Sanjay Agarwal, managing director KS Oil that mustard oil production will be good since there is a 40% increase in acreage and climate was conducive.
Meanwhile soyabean crushing continues though arrivals are less as farmers are expecting higher prices. Prices have already gone up to Rs 2,000 per quintal from Rs 1,500 in a month. India imported mainly palm oil products and sunflower oil. Mr Bajoria said that India would import nearly 18.5 lakh tonne of edible oil — four lakh tonne of soyabean and sunflower oil, 11 lakh tonne of crude palm oil and 3.5 lakh tonne RBD olein. “These will arrive between January 1 and March 31 ensuring good supplies,” he said.
India imports half of its edible oil requirement of around 11-12 million tonne. The major imports are palm oil and soya oil. India imported a record 5.6 million tonne of edible oil in 2007-08 (November-October). Rajesh Agrawal from the Soyabean Processors Association of India (Sopa) says that demand and supply should improve from middle of February with imported soyabean oil and rape seed oil arriving in February. Mr Agrawal, however, added that edible oil prices will be stable to firm during the period as international market has gone up and domestic arrivals are low.
Though Sopa has pegged soyabean production at 108 lakh tonne for this year, but other differ. According to Govindlal Patel, from Dipak Enterprise which is into edible oils import and trade, groundnut production will be lower compared with last year. “The total availability of domestic oil will be low by two lakh in the current oil year but good imports will ensure a smooth supply in local markets,” he added.
Source : The Economic Times