India`s Vegetable Oil Stocks Hit 5-Year Low on Weak Imports By Amit Gupta , Kedia Advisory
India’s vegetable oil inventories have dropped to their lowest in nearly five years due to reduced imports, particularly of palm oil, according to the Solvent Extractors’ Association (SEA). In April, palm oil imports plunged by 24.29% month-on-month, contributing to a total vegetable oil import volume of just 891,558 tons—the lowest since February 2021. Stocks fell to 1.35 million tons as of May 1. Palm oil's premium over soyoil earlier this year led to a shift in buying patterns, but with palm oil now trading at a discount, imports are expected to rebound. This trend could support Malaysian palm oil and U.S. soyoil prices in the coming months.
Key Highlights
* April vegetable oil imports drop to 891,558 tons, lowest since Feb 2021.
* Palm oil imports plunge 24.3% to 321,446 tons; sunflower oil also down.
* Total stocks fall to 1.35 million tons as of May 1, lowest since July 2020.
* Palm oil’s share of imports shrinks to 42%, down from 60% last year.
* Lower prices may boost palm oil imports from May onward.
India's vegetable oil market has shown a sharp contraction, with stockpiles hitting a five-year low following weak import activity. According to the Solvent Extractors’ Association of India (SEA), total vegetable oil imports in April declined to 891,558 metric tons marking the lowest monthly figure since February 2021. This drop has dragged domestic inventories down to 1.35 million tons as of May 1, the lowest since July 2020.
The performance of palm oil was particularly weak. Imports dropped 24.29% from March to 321,446 tons, as buyers turned cautious amid a premium over other oils. Meanwhile, soyoil imports slightly rose by 1.6% to 360,984 tons, and sunflower oil saw a marginal drop of 5.5% to 180,128 tons.
The pricing shift played a critical role in this import reshuffling. In the initial half of the 2024/25 marketing year, palm oil’s share in India’s total vegetable oil imports fell sharply to 42%, down from 60%. On the other hand, soyoil and sunflower oil's combined share rose to 58%. However, with palm oil now trading at a discount, a reversal in trend is expected. Industry insiders believe that India may soon ramp up palm oil imports, especially from key suppliers like Indonesia and Malaysia.
This increase in demand could act as a bullish trigger for global markets, especially for Malaysian palm oil and U.S. soyoil futures. With depleted domestic stocks, India may have no choice but to accelerate purchases to meet upcoming demand..
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