According to Reuters on January 16th, in order to control the rise in food prices, the Indian government has extended the low import tariffs on edible oil for another year, until March 2025. The report states that India's lower import tariffs on crude palm oil (CPO), crude sunflower seed oil, and crude soybean oil will expire in March.
The report quoted Sandeep Bajoria, CEO of Sunvin Group, a vegetable oil brokerage company, as saying, "This decision is expected because the government wants to control prices before the election."
Reuters reported that India's annual retail inflation in December reached its fastest pace in four months, driven by rising food prices.
According to reports, the country mainly purchases palm oil from Indonesia, Malaysia, and Thailand, while importing soybean oil and sunflower seed oil from Argentina, Brazil, Russia, and Ukraine. Among them, palm oil has the largest import volume, accounting for 20% of the global total import volume; The import volume of soybean oil ranks second, but it accounts for 30% of the total global import volume.
Last December, India's palm oil imports reached their highest level in four months due to a surge in purchases of refined palm oil due to price competition.
BV Mehta, Executive Director of the Solvent Extractors' Association of India, stated that although the government's goal is to maintain price stability, long-term policies have had a negative impact on local oilseed growers.
The report quoted Meta as saying, "The pressure brought by cheap imports on oilseed prices actually hinders (farmers) from planting more oilseeds."
The report states that India meets over two-thirds of its edible oil demand through imports, and has been striving to increase oilseed production as farmers find other crops more profitable. The Indian government approved a national edible oil self-sufficiency plan worth 114 billion rupees in August 2021 to increase domestic edible oil products and reduce imports and prices. For example, in the field of palm oil, the Indian government has launched the National Edible Oil Oil Palm Task (NMEO-OP), which plans to vigorously develop oil palm cultivation in northeastern India and the Nicobar Islands. It is expected that India will increase its oil palm coverage by 650000 hectares by fiscal year 2025-26 and an additional 670000 hectares by fiscal year 2029-30; At the same time, in order to increase the enthusiasm of farmers for planting and ensure their interests, this plan will also provide a fixed minimum support price (MSP) for all growers. However, despite this, it is still difficult for India to change its dependence on imports in the edible oil market in the short term.