India’s Vegetable Oil Imports Set to Climb as Rapeseed Crop Hit by Drought

High temperatures and low soil moisture have cut into India’s rapeseed acreage this year, leading industry and trade officials to expect the country’s imports of high-priced vegetable oils to climb for another year, reports Reuters.

Sowing of rapeseed, India’s main winter oilseed, and the oilseed with the highest oil content, began under adverse conditions this year, and as sowing is nearing an end, growers are stating that a significant portion of the crop is already lost due to the country’s first back to back drought in 30 years India’s farmers have planted 4.25 million hectares of rapeseed so far this year, representing a drop of 21.4%, as some farmers are switching from rapeseed to lentils or pulses.

Last year, India’s rapeseed output fell by 23% to 5 million tons as the country’s vegetable oil imports climbed by 23.6% to a new record of 14.61 million tons in the year ending October. After four consecutive years of record imports, India’s vegetable oil imports are expected to rise once again next year as the country will need an additional 1 million tons to meet its rising per capita consumption and growing population.

India relies heavily on vegetable oil imports to meet its total demand of between 18 and 19 million tons per year, spending approximately $10 billion per year on imports of palm oil from Malaysia and Indonesia, supplemented by small volumes of soyoil imports from Brazil and Argentina. Vegetable oils are India’s third largest import item following crude oil and gold.