Jan. 8 (Bloomberg) -- India, the biggest vegetable oils consumer after China, called bids to import 30,000 metric tons of palm oil after a drought damaged oilseed output, straining global supplies of edible oils.
MMTC Ltd., India’s biggest state trader, is seeking 18,000 tons of refined bleached and deodorized palmolein for delivery later this month, and state-owned PEC Ltd. needs 12,000 tons next month, the companies said in notices on their Web sites.
Vegetable oil purchases by India will reach a record 9.4 million tons this year as an import tax waiver pares costs and smaller oilseed crops widens a deficit, B.V. Mehta, executive director of the Solvent Extractors’ Association of India, said. Increased purchases may help sustain a 39 percent rally in crude palm oil in the past year.
“The local crop is down and demand is rising because of a growing population,” Mehta said in a phone interview in Mumbai today. “Imports will remain high as that’s the only way to make up for the shortfall in supplies.”
Palm oil for March delivery shed as much as 1.5 percent to 2,590 ringgit ($767) a ton on the Malaysia Derivatives Exchange today, and traded at 2,601 ringgit at 12:30 p.m. break. Prices advanced 56 percent last year on rising demand from China and India, the biggest consumers.
Edible oil imports may average 2 million tons in each of the first two quarters of the crop year started Nov. 1, Mehta said. Purchases may exceed 5 million tons in the second half of the season when local edible oil supplies cease, he said.
Imports in November totaled 712,677 tons, 37 percent more than the 519,032 tons a year earlier. Imports in December may have exceeded 700,000 tons, Mehta said.
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