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May edible oil imports likely to hit lowest level in 10 years


India’s May edible oil import is expected to decline to 7.5 lakh tonnes, the lowest in a decade, according to industry estimates. Drop in demand for cooking oil by 25% in hotels, restaurants and cafes coupled with lesser purchases for domestic consumption in May led to the decline in imports.

Generally, over the years, import of edible oils hovers around 12 lakh tonnes in May. But this year it has dropped almost 38%.

The drop in out-of-home consumption in the country may shave off about 2.5 million tons from the country’s annual edible oil consumption of 23 million tons, said Atul Chaturvedi, president of the Solvent Extractors’ Association of India (SEA). India imports 14.9 million tonnes of edible oils annually.

B.V. Mehta, executive director of SEA, said it might also be that in April people may have stocked more edible oil as they were not sure how long the lockdown would continue. “So the domestic purchases may have dropped in the month of May as Indian households had enough stock,” he said.

Besides household consumption, the edible oils are consumed by two commercial segments – hotels, restaurants, events and catering institutions and bakery and snacks industry.

“There has been absolutely zero demand from the HoReCa segment. The demand from bakery and snacks has started getting normal from post first week of April 2020, ” said P Chandrashekhara Reddy, vice president sales & marketing, Gemini Edibles & Fats India.

The household segment has seen an increase of demand by 20% due to the lockdown, said Reddy.

“Palm oil demand has gone down by 50%, while sunflower oil demand has gone up by 20% in the markets we operate in. In AP, Karnataka, Telangana and Odisha, Freedom Refined Sunflower oil is the most preferred edible oil used at home. In Odisha, both, mustard and sunflower oil, is consumed at home. Hence, sunflower demand has gone up. As 90% of hotels & restaurants use only palm oil, palm oil sales are down,” he added.

However, the industry is expecting June demand to move up compared to May. “Imports will go up to 10 lakh tonnes in June as offices and industries are reopening. In some states hotels and restaurants have also been permitted to reopen. This will give a push to the demand,” said Mehta.





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