Palm imports by India, the world’s largest consumer, probably climbed in October as a delay in the oilseed harvest reduced cooking oil stockpiles to the lowest level in nine months.
Shipments of the main crude and refined palm oils advanced 14 percent to 710,000 metric tons from 620,385 tons a month earlier, according to the median of estimates from five processors and brokers compiled by Bloomberg. Total vegetable oil imports, including those for industrial use, rose 10 percent to 950,000 tons, the survey showed. The Solvent Extractors’ Association of India will release the data this week.
Increased purchases may extend a rally in prices of palm oil, used in everything from candy to cosmetics. Futures in Kuala Lumpur entered a bull market on Nov. 1 and are heading for their first annual gain in three years amid production declines in Indonesia, the world’s biggest supplier.
“The Indian crop was delayed, leading to lower supplies ahead of festivals,” said Sandeep Bajoria, chief executive officer of broker Sunvin Group, referring to Diwali and Eid celebrations when consumption of fried foods and sweets expands.
An extended monsoon delayed the harvest of soybeans and peanuts this year, said Mumbai-based Bajoria. The Soybean Processors Association of India cut its forecast for the biggest oilseed crop grown in the season to 12.2 million tons on Oct. 28 from 12.98 million tons.
Reserves Drop
Stockpiles of cooking oils at Indian ports dropped to 1.47 million tons on Oct. 1, the lowest since January, according to the Solvent Extractors’ Association. Inventories may have reached 1.6 million tons at the start of November, said Bajoria. India meets more than half its demand through imports.
Palm for delivery in January advanced 0.7 percent to 2,618 ringgit ($816) a ton on the Malaysia Derivatives Exchange today, the highest price since Nov. 4. Prices rose to 2,628 ringgit on Nov. 1, the highest close since September 2012 and 21 percent more than the 2,167 ringgit settlement on July 29, meeting the common definition of a bull market.
“Imports will start to drop from this month as the new crop comes in,” said Pradip Desai, managing director of Mumbai-based broker Palm Trade Services Pvt. “Soybean oil import demand will be lower.”
Vegetable oil purchases in the 11 months through September rose 5.5 percent to 9.66 million tons, data from the association showed. Imports will surge to 10.4 million tons to 10.5 million tons in the year ended Oct. 31 from 10.2 million tons a year earlier, said Bajoria.
Crude soybean oil imports probably fell to 100,000 tons in October from 140,971 tons a month earlier, while sunflower oil purchases may have jumped to 115,000 tons from 48,498 tons, the survey showed.
Source:- bloomberg.com
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