FNB News - Import of vegetable oils in Dec ’18 up by 11 per cent vis-a-vis Dec ’17

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OILS AND FATS

Import of vegetable oils in Dec ’18 up by 11 per cent vis-a-vis Dec ’17

Wednesday, 16 January, 2019, 08 : 00 AM [IST]

Our Bureau, New Delhi

The import of vegetable oils during December 2018 is reported at 12,11,164 tonne compared to 10,88,783 tonne in December 2017, consisting of 11,45,794 tonne of edible oils and 65,370 tonne of non-edible oils, i. e., up by 11 per cent.

The Solvent Extractors’ Association of India (SEA) has compiled the import data of vegetable oils (edible and non-edible) for the month of December 2018. The overall import of vegetable oils between November and December 2018 was reported at 23,45,057 tonne compared to 23,37,593 tonne, which is more or less the same.

Import of vegetable oil (Edible and non-edible)
Nov-Dec 2018
(Quantity in metric tonne)

Month	2018-19			2017-18			Percentage change
Month	Edible	Non-edible	Total	Edible	Non-edible	Total	Percentage change
November 2018	10,73,353	60,540	11,33,893	12,25,315	23,495	12,48,810	(-) 9%
December 2018	11,45,794	65,370	12,11,164	10,58,289	30,494	10,88,783	(+) 11 %
Total	22,19,147	1,25,910	23,45,057	22,83,604	53,989	23,37,593	(-) 0.32%

The change in the import duty of CPO and RBD Palmolein
The ministry of finance issued two notifications numbered 84/2018 Customs, both dated December 31, 2018, reducing the import duty on palm oil and also reducing the duty difference between crude and palm oil from 10 per cent to five per cent on palmolein to be imported from Malaysia. This has lead to overall reduction in effective duty by 4.4 per cent for CPO, but in case of RBD Palmolein imported from Malaysia would be 9.9 per cent. The duty reduction has cut the effective duty difference between CPO & RBD Palmolein to just five per cent against previous 10 per cent as under:

The new import duty structure with effect from January 1, 2019 is as under:

Oils	Old Effective Duty Duty+Social=Effective Welfare Duty Cess	Revised Effective Duty Duty+Social=Effective Welfare Duty Cess	Change in Duty
Malaysia
Crude Palm Oil	44%+10%=48.4%	40%+10%=44%	(-) 4.4%
RBD Palmolein	54%+10%=59.4%	45%+10%=49.5%	(-) 9.9%

Indonesia
Crude Palm Oil	44%+10%=48.4%	40%+10%=44%	(-) 4.4%
RBD Palmolein	54%+10%=59.4%	50%+10%=55%	(-) 4.4%

The reduction in the duty difference will encourage larger import of RBD Palmolein in coming months, detrimental to the interest of domestic oil palm cultivation and will also erode the competitiveness of domestic refiners.

Stock position at port and in pipeline
The stock of edible oils as on January 1, 2019 at various ports is estimated at 8,05,000 tonne (CPO 4,30,000 tonne, RBD Palmolein 1,50,000 tonne, degummed soybean oil 80,000 tonne and crude sunflower oil 1,45,000 tonne) and about 12,20,000 tonne in pipelines. The total stock at ports and in pipelines is reported at 20,25,000 tonne, decreased by 1,66,000 tonne from 21,91,000 tonne as on December 1, 2018.

Stock position at ports and pipelines
(Quantity in ’000 metric tonne)

	Jan 1, 2019	Dec 1, 2018	Nov 1, 2018	Oct 1, 2018	Sep 1, 2018	Aug 1, 2018	July 1, 2018	June 1,2018	May 1,2018	April 1,2018	March1, 2018	February1, 2018	January1, 2018
Portstock	805	861	895	923	994	928	948	1,002	1,068	770	757	855	876
Pipe lines	1,220	1,330	1,430	1,630	1,580	1,547	1,570	1,660	1,270	1,342	1,440	1,340	1,300
Totalstock	2,025	2,191	2,325	2,553	2,574	2,475	2,518	2,662	2,338	2,112	2,197	2,195	2,176

Import of refined and crude oil ratio
During November-December 2018, the import of refined oil (RBD Palmolein) decreased to 2,39,370 tonne from 2,54,286 tonne in the same period of last year, Also, the import of crude oil decreased and reported at 19,79,777 tonne compared to 20,29,318 tonne during the same period of last year.

Year (November-October)	Refined oils	Percentage	Crude oils	Percentage	Total
November 2018	1,08,911	12%	9,64,442	88%	10,73,353
December 2018	1,30,459	10%	10,15,335	90%	11,45,794
(November-December 2018) (November-December 2017)	2,39,370 2,54,286	11% 11%	1,979,777 20,29,318	89% 89%	22,19,147 22,83,604
2017-18	21,35,780	15%	1,23,80,752	85%	1,45,16,532
2016-17	28,70,928	19%	1,22,06,492	81%	1,50,77,420
2015-16	26,23,002	18%	1,19,48,336	82.00%	1,45,71,338
2014-15	16,59,070	12%	1,27,62,201	88%	1,44,21,271

Import of palm and soft oil ratio
During November-December 2018, palm oil import has increased to 15,03,527 tonne from 14,39,825 tonne during the same period of last year. However, soft oil imports decreased to 7,15,620 tonne from 8,43,779 tonne during the same period of last year. The duty changes will promote the Indian import demand for palm oil at the expense of soft oils. The preferential rate will put Malaysia in a position to gain market share from Indonesia.

Import of palm oil and soft oil (Ratio) (Quantity in MT)

Year (November and October)	Palm Oil		Soft Oil					%	Total
Year (November and October)	(RBD Palmolein + CPO + Crude Olein + CPKO)		Soybean	Sunflower	Rape	Others	Total
November 2018	6,91,827	64 %	2,03,734	1,65,550	12,242	--	3,81,526	36%	10,73,353
December 2018	8,11,700	71%	85,404	2,35,824	12,866	--	3,34,094	29%	11,45,794
November- December 2018 November December 2017	15,03,527 14,39,825	68% 63%	2,89,138 3,53,178	4,01,374 4,30,465	25,108 60,136	-- --	7,15,620 8,43,779	32% 37%	22,19,147 22,83,604
2017-18	87,01,062	60%	30,47,040	25,24,793	2,40,625	3,012	58,15,470	40%	1,45,16,532
2016-17	92,93,717	62%	33,16,207	21,68,754	2,92,652	6,090	57,83,703	38%	1,50,77,420
2015-16	84,42,840	58%	42,34,809	15,16,220	3,77,469	-	61,28,498	42%	1,45,71,338
2014-15	95,36,904	66%	29,85,944	15,42,599	3,55,824	-	48,84,367	34%	1,44,21,271

Average prices and rupee depreciation
(Price in $/CIF Indian Port/Tonne)

Oils	December 2018	November 2018	October 2018	September 2018	August 2018	July 2018	June 2018	May 2018	April 2018	March 2018	February 2018	January 2018	December 2017
RBD Palmolein	518	510	568	575	578	592	631	661	673	678	677	669	661
Crude palm oil	482	472	529	551	565	583	623	652	664	671	675	669	662
Crude soybean oil	679	682	706	689	691	709	727	771	808	804	809	817	811
Crude sunflower oil	693	689	717	748	774	795	785	806	822	807	803	800	800
FE: $1 = (Average)	70.83	71.73	73.56	72.28	69.63	68.69	67.79	67.51	65.67	65.05	64.43	63.65	64.24

In last one year, in international market, prices of various edible oils have gone down in the range of 15 and 30 per cent due to excess supply in the world market.

Import of non-edible oils
The import of non-edible oils during November and December 2018 is reported at 1,25,910 tonne only compared to 53,989 tonne during the same period last year, i e up by 133 per cent, thanks to nil duty on P F A D and RBD Palm Stearin. P F A D, C P S and RBD Palm Stearin are the major import of non-edible oils.