Mumbai: The price of palm oil in India has risen more than 6% even after the government cuts import taxes and allows delivery of fine palm oil because the price abroad soars to anticipate strong demand from the largest buyers in the world, industrial officials said.
Higher palm oil prices can burden Indian demand and can ask the government to refrain from cutting import taxes further because price increases highlight the limited task reduction.
Malaysian palm oil futures, which corrected after reaching a multi-year high, has increased by 9% since India cut its import tax on crude palm oil (CPO) of 5% for three months on June 29.
India also allows fine palm oil imports.
On June 30.
“As soon as India cuts tasks, international suppliers raise prices,” said BV Mehta, Executive Director of the Indian Solvent Extractors Association (Sea), Distillery Trading Agency and Indian Vegetable Oil Traders.
“Every time India reduces the task, the international market rises.
Part of the benefits of task cutting absorbed by Indian suppliers and consumers get the rest.
But this time, Indian consumers do not benefit.” The cost of landing palm oil in India has risen to $ 1,085 per ton of $ 1,020 per ton on June 29, according to the data compiled by the sea.
During this period, the price of fine palm oil rose to $ 1,055 per ton of $ 1,020 per ton.
India cut imported taxes on CPO because domestic prices almost doubled last year, hitting consumers has been stung by recording fuel prices and reducing income in the middle of Covid-19 pandemic.
Indian buyers aggressively started purchases after the government allowed imported palm oil imports and cut imported taxes, support Malaysian palm oil futures, said Mumbai based dealer with global trading companies.
“India is likely to restore the old task structure after September because the local price is firm even though there is a lower task,” said the dealer.