After duty cut, CPO imports in India are expected to increase rapidly

11-Jun-2025 08:08 PM

Singapore. Recently, the Government of India reduced the basic import duty on crude palm oil CPO, crude degummed soybean oil and crude sunflower oil by half from 20 percent to 10 percent, which will give a good incentive to Indian refiners to increase the import of CPO because,

firstly, due to the decrease in imports for the last four-five months, its stock in the country has come down significantly and secondly, the price of crude palm oil has also come down to an attractive level in comparison to soybean oil and sunflower oil. In May, India had a good import of palm oil, which gave some relief to the producers-exporters of Malaysia and Indonesia.

According to trade analysts, earlier the price of crude palm oil (CPO) was running above soybean oil, so the importers of India and China were showing less interest in its purchase, but now the price of CPO has come down to below soy oil.

This will increase the global competitiveness of palm oil. Indian importers may import a good amount of crude palm oil from Malaysia in the June to August quarter. Currently, the export offer price of palm oil is around $128 per tonne lower than soybean oil.

The total effective customs duty on crude edible oils in India has come down from 27.5 percent to 16.5 percent. On the other hand, it remains at the previous level of 35.75 percent on refined edible oil (mainly RBD palmolein) as no change has been made in it.

On the other hand, the Indonesian government has increased the export levy on crude palm oil to 10 percent, which has come into effect from May 17.

Its purpose is to raise funds for the biodiesel program and subsidized replantin. As a result, CPO exports from Indonesia are expected to be adversely affected, while refined palm oil / palmolein exports may increase. Malaysia may get a good opportunity to increase its CPO exports from this.