PALM oil consumption in India is down by 40% as the food service industry reels from the coronavirus shock.
As India continues the world’s biggest shutdown, keeping most of its 1.3 billion population indoors, restaurants and hotels are either shut or working at a minimal capacity.
“The reduction in palm oil imports is a reflection of demand in the food service industry. There is a definitely a 40% drop,” Sudhakar Desai, president of the Indian Vegetable Oil Producers’ Association (IVPA), told Bernama.
Restaurants, bakeries and other food businesses that are significant users of palm oil are operating at 10-20% capacity, he said.
“Household demand is intact. Some vegetable oil demand has shifted to households, so we see an increase in soybean, sunflower and local mustard oil consumption,” Desai said.
About the availability of vegetable oil, he said refiners and ports have sufficient stocks to meet local supplies.
When the coronavirus lockdown is relaxed, Indian refiners are expected to ramp up their output.
The disruption has affected logistics and ports, contributing to the reduction in palm oil imports.
India, the world’s biggest importer of edible oils, on Monday cancelled dozens of licenses for refined palm oil products after authorities suspected violation of the “rules of origin” in duty-fee imports from Nepal and Bangladesh.
The Commerce Ministry’s decision would help local oilseed farmers, especially those growing mustard, and support the domestic refining sector suffering from a 40% idle capacity, Desai pointed out.
India relies on Indonesia and Malaysia for its palm oil imports, buys soybean oil from Argentina and Brazil, and sunflower oil from Ukraine and Russia. – May 13, 2020, Bernama
