India’s Record Soyoil Import from the United States of America

Due to limited supply from drought-stricken South America, Indian exporters have arranged to import a record 100,000 tonnes of soyoil from the United States, at a time when palm oil prices are reaching new highs.

Overview:

India, the world’s largest edible oil importer, generally buys soyoil from Brazil and Argentina, but this year’s low bean output in these two leading producer countries has forced India to sign a contract with the producers from the United States for import of the oil.

India’s two-thirds of soyoil comes from Argentina while the rest is procured from Brazil. But, the previous season’s low soybean production has caused the oil reserves to fall in Argentina, thus, forcing Indian traders to look for alternatives in the US.

Sunflower oil is much cheaper than soyoil but its delivery is at risk due to the geopolitical situation in Europe.

Last month, soyoil was cheaper than palm and sunflower oil, but a sudden surge in soyoil demand has pushed prices up by 16 percent in a month to the highest in 14 years.

India depends mostly on imports for two-thirds of its edible oil requirements, primarily palm oil from Malaysia and Indonesia. But, Indonesia’s move to restrict palm oil exports has driven up the price of tropical oil and created shortages in the edible oil market.