India, the world's biggest edible oil importer, bought a record 1.06 million tonnes in August, 64 percent higher than a year ago. Purchases since the beginning of the year in November are up 5 percent at 7.45 million tonnes.
Alarmed by all-time high imports, leading trade and industry bodies have repeatedly requested that the government levy a tax to discourage imports.
"I do not feel India will impose duty on crude vegetable oil or raise it on refined oil due to (the) rise in food inflation," London-based Dorab Mistry, who heads the trading arm of Godrej International Ltd, told Reuters.
Food inflation has been accelerating in recent weeks with government data on Thursday showing the country's food price index rose 15.10 percent year-on-year in the week ended Sept. 4.
The country allows duty-free imports of crude vegetable oils and imposes a 7.5 percent tax on the refined variety.
India buys palm oil from Malaysia, Indonesia and small quantities of soyoil from Argentina and Brazil.
Imports of palm oil were at 5.2 million tonnes or 73 percent of total cooking oil purchased so far in the current 2009/10 oil year. Soyoil accounted for 20 percent at 1.4 million tonnes.
Mistry said the rise in global prices would also prohibit India from either slapping a levy on crude vegetable oils or raising the levy on refined varieties.
Palm oil has rebounded 19 percent from an eight-month low on July 7 on speculation that demand will increase from Asia and harvesting in Malaysia and Indonesia will be disrupted in November and December should La Nina cause flooding.
Source : Reuter dt 22.09.2010
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