1.	India is the 2nd largest most populous Nation, Largest democracy country with maximum young people, One of the fastest growing economy.
2.	India is the largest importer of edible oils in the world. India imported 4.43 ml T of edible oils during 2001-02 and it had increased to 15.07 ml T during 2016-17. The growth of import of edible grade Palm Oil during this period was 180% while growth in import of Soft Oils was 287%.
3.	Import of Non-edible Palm Oil was 263k during 2001-02 which increased to 362k during 2016-17. Off-course during the year 2005-06 to 2007-08, it had increased to 700k/600k.
4.	Consumption of Palm Oil during 2001-02 was 29.08% of all the edible oils consumed in India and it increased to 41.71% during 2016-17. It is likely to remain around 42% in 2017-18.
b.	A big expansion in the Indian Middle class of people.
c.	Double digit growth of Out of Home consumption of edible oils.
d.	Per Capita consumption of edible oils in 2001-02 was 9.4 kg and it increased to 16.3 kg in 2016-17 and likely to increase to 16.8 kg in 2017-18. Still Per Capita consumption is below the threshold level of consumption. Low consuming States of Central and East India will catch up with their peers of West and North India.
e.	Even with a Moderate Population growth, absolute increase in number of people is quite high.
f.	Schemes like NREGA and rising the income level of people who are consuming much below all India level.
g.	Rising urban population and many more.
a.	Mustard Oil is Kachchi Ghani Oil with a strong pungent smell. The biggest markets for this oil are East India followed by North India.
b.	Cottonseed Oil have a largest consumption in Gujarat and Surrounding States.
c.	Sunflower Oil is preferred by affluent class of people of South and West India.
d.	Refined Soybean Oil is preferred by consumers in Madhya Pradesh, Maharashtra and North India.
e.	Palm Oil is highest selling oil in the country. This is gaining big popularity in the Out of Home Consumption (HORECA) segment. This is the preferred oil in South India and Coastal East India. It is gaining popularity in West and North India also.
f.	Groundnut oil, once upon a time, the most preferred oil but now slowly dying out due to high price and low availability. The demand of Groundnut Kernel is phenomenally growing. Hence creating a scanty of availability of Seed for crushing.
7.	There is seasonal pattern of Palm Oil consumption. During Summer period, consumption is the highest i.e. from March to June. At higher temperature, during these months Palm Oil does not become hazy. During Monsoon, demand is reasonably high i.e. during July to October. During Winter, consumption is low i.e. during Nov to Feb. As the temperature are low, Palm Oil becomes hazy while the people prefer Oil in liquid form.
a.	Tremendous growth in Fast Food Industry.
b.	More than 80% of Urban Indians eat out several times in a month.
c.	Families order Food from Outside.
d.	Visitors visiting Malls end up visiting Food Court.
9.	Production of Domestic Oils increased from 5.64 ml T in 2001-02 to 7.08 ml T during 2016-17 while the consumption increased from 10.12 ml T in 2001-02 to 21.75 ml T in 2016-17. The domestic production is not catching up with the consumption and hence there is every year increase in import of edible oils. Dependency on import during 2001-02 was 44% which has increased to 68% in 2016-17.
Do you think palm oil will be consumed directly by consumers in INDIA in coming years like all other soft oils like sunflower, cottonseed and Ground nut oil??
Your analysis shows that with steep rise in palm oil import duty, import in India will favor CPO. Can you explain more on this behaviour. Is it always the case when there is a steep rise in palm oil import duty, higher proportion of CPO will be imported in India. What is the spread now of buying refined products e.g. palm olein from local refinery compared to imports.
When Palm Oil becomes costlier by hike in import duty, the by product prices of Stearin and PFAD also increases which lessons cost of refining of CPO and i.e. why there is more import of CPO. Today the difference between import duty of RBD OLN and CPO is 10.25%. The RBD OLN produced by Indian Refiners is being sold higher by USD 4/5 PMT as Indian Refined Oil quality is better than the quality of imported RBD OLN.
Thank you for the impressive answer provided to my earlier question. In your answer, you say that regulation related to stearin import is that it must contain more than 20% FFA and Stearin containing more than 20% FFA is not available in the International Market. As a result, the amount of stearin imported by India is very little. The question is what is stearin mainly use for? How do these usersmanage their raw material needs amidst India stearin short supply?
Stearin is mainly used for manufacture of Soap, Vanaspati (Hydrogenated Oils), Noodles, Backery Products, Bio-diesel, etc. Stearin is available in India which is by-product of CPO Refining. Actual Users (Manufacturers) get Import Licences for import of Stearin against export of their products. Hence some requirement for Stearin is fulfilled by this way.
Dear Mr. Govindbhai G. Patel, Recently suspend export tax duty from Malaysia, does this will benefit to Importer in India and do Importer have better interest to buy more quantity from zero export duty or higher export duty from others country? Thank you.
The suspension of Export Duty by Malaysia has not helped much the Indian importers as far as the prices of Palm Oil is concerned. Even after suspension of export duty by Malaysia, there is no decrease in prices of Palm Oil for CNF Indian Ports. For export of Palm Oil to India, Malaysia competes with Indonesia. Still after reduction of export duty by Malaysia, the Palm Oil from Indonesia is available at the same price or even some times cheaper than Malaysia. In terms of substitution of Palm Oil in place of Soft Oils has not also helped much in increasing quantity of Palm Oil into India. Still the difference between the Soft Oil and Palm Oil CIF India are almost same which were prevailing before duty reduction by Malaysia.
Dear Mr. Govindbhai G. Patel, Malaysia and Indonesia export of olein to India been badly affected in November and December after the sharp rise in import duty, however CPO remained steady. Are the Indian refiners happy? Is the refining utilization up sharply?
Indian Refiners are happy as their capacity utilisation for processing has increased. The capacity utilisation has not increased sharply (as there is too much under utilisation capacity) but better utilisation than previous.
Your analysis shows that palm oil will continue to be imported at around 2017 level in 2018. However, very much more crude palm oil will be imported compared to refined. For 2017/18, you forecast that refined palm oil import will drop by 1.17 million MT to 1.7 million MT while crude palm oil import will increase by 1.18 million MT. Issue is that when CPO is refined there are various types of refined products being produced in particular stearin. Issue is that how India is absorbing the high amount of refined palm fractions produced especially stearin. ? The other issue is that isn’t publicly sensitive for your country to practise such steep duty adjustment? How does your government, NGOs etc, deals with it?
There is enough demand for Stearin and PFAD in India which are the by-product of CPO processing. Of course, import of Stearin is at NIL Duty but condition for the import of Stearin is that it should contain more than 20% FFA and Stearin containing more than 20% FFA is not available in the International Market and that is why no import of Stearin and good demand for Stearin produced in India. This import condition is recent one which was not in the last year. Hence there will be more import of CPO in India rather than RBD Olein. Due to recent increase in import duty on Palm Oil by 10% has also increased the prices of Stearin and PFAD in India making the import of these by-products uneconomic. This will slightly decrease processing cost of CPO. There was lot of pressure from the farming lobby to increase the import duty on edible oils as the farmers were not realising remunerative prices of Oilseeds and hence the Government has increased the import duty on edible oils. Neither the Consumers nor NGOs oppose the increase of import duty on edible oils by the Indian Government.