NEW DELHI (Commodity Online): India will import 10% more crude palm oil from Indonesia in the next year in order to bridge the demand and supply gap because of lower domestic production due to meager monsoon.

Indonesia interested in with the deal as India cut the import duties on CPO as per Comprehensive Economic Cooperation Agreement (CECA), which was signed today.

The pact with the ten nations Association of South East Asian Nations will eliminate duties on 4,000 items by 2016, covering 80 per cent of India's imports from the South-east Asian nations.

The erratic monsoon and likely lower oilseeds crop will further push up the imports in September and October. Production of crops will suffer a major setback this year as the dryness has partly prevented plantings and will also curb the yield potential massively.

Trading platform that even a 5 year old can trade. Join now

Although India currently doesn’t impose an import tax on CPO, it has been known to impose import taxes as high as 80% on CPO when the country goes into its harvest season for domestically grown oilseeds, said Bangun.

India scrapped its import tax on CPO last year to stabilize local vegetable oil prices after prices of key vegetable oil imports like CPO hit record highs.

Area under oilseeds including peanuts and soybeans dropped to 3.75 million hectares as of Aug 6 from 4.55 million hectares a year ago, the farm ministry said.

Vegetable oil imports in July, including cooking oils, were 596,024 tons, 5% more than a year ago. Imports included 66,290 tons of sunflower oil. Crude palm oil purchases in the nine months ended July 31 rose 32% to 3.83 million tons, while soybean oil imports gained 73% to 726,716 tons.

Post your comment  (0)

Connect:

Post to Twitter

Post to Facebook