Market participants in India expect imports of refined palm oil to be significantly lower in the coming marketing year, as import duties favor crude palm oil. The government in Delhi wants the different customs rates to prefer the oil mills in the country and keep them from the austerity of the competition from abroad.
Refined palm oil from Indonesia and Malaysia existed to a large extent, as the processing capacities there were greatly expanded. This is the aim of the Indian market, which is the largest palm oil importer in the world. The spread between refined and bleached palm oil and raw palm oil had thereby been matched.
Now the Indian government wants to protect the refineries in the country from the overwhelming competition from abroad by increasing the import tariff for raw palm oil from 7.5 to 15% and increasing the refined palm oil from 10 to 25%. The difference was previously 2.5% and is now 10%.
Leading refineries in the country now expect an import share of raw palm oil of 90%, compared to 69% in the previous year. They rejoice over these measures while the importers are worried.
In the first nine months of the marketing year, which began on 1 November, India imported 6.74 million tons of palm oil, of which 2.2 million tons were already refined abroad. The share of palm oil in Indian cooking oil imports has been steadily declining in recent months as soybean oil and sunflower oil have become more favorable.
According to the latest amendments to Importzoll, raw soya oil is taxed at 17.5% and refined palm oil at 25%. This is likely to boost the import of soybean oil.
