Indian Refiners' Palm Oil Purchase Cancellation To Be Short-lived -- Johari

By Harizah Hanim Mohamed

KUALA LUMPUR, Oct 8 (Bernama) -- Indian refiners' decision to cancel approximately 100,000 metric tonnes of palm oil purchases in response to its government’s recent import tax hike is considered a temporary measure, said Malaysia’s Plantation and Commodities Minister Datuk Seri Johari Abdul Ghani today.

According to reports, India raised the basic import tax on crude and refined edible oils by 20 percentage points, effectively increasing the total import duty on crude palm oil from 5.5 per cent to 27.5 per cent.

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This cancellation represents 13.3 per cent of India’s total monthly imports, which amount to 750,000 tonnes.

Despite the cancellations, Johari expressed confidence that, with a population of 1.45 billion, India will continue to require vegetable oil for consumption. 

“We will continue to be a good partner (to India) and offer sustainable palm oil,” he told a media conference held in conjunction with the Malaysian Palm Oil Forum (MPOF), here today.

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India is the world’s largest importer and the second-largest consumer of edible oils.

In the fiscal year 2022-23 (April-March), India imported 16.5 million tonnes of edible oils, with domestic production meeting only 40 to 45 per cent of the total requirement.

Its consumption of oils and fats was approximately 27.2 million tonnes in 2023, with palm oil accounting for 36 per cent of that figure.

In 2023, India imported 2.83 million tonnes of palm oil from Malaysia, representing 18 per cent of total Malaysian palm oil exports. Its other palm oil suppliers include Indonesia and Thailand.

In response to a question about potential engagement with the Indian government to reconsider the import duty, the minister emphasised that such decisions are the prerogative of the respective government. 

“We can't do that (asking the Indian government to reconsider) because that is the right of their government and any tax issues with respect to the country, we can’t disturb,” he added.

Responding to a question about Malaysian Sustainable Palm Oil (MSPO) and exports to Russia, Johari noted that Malaysia is offering palm oil for both food and non-food consumption to Moscow.

He highlighted that Malaysia has yet to fully explore the market potential of Russia’s population of 144.82 million. 

“I want to focus on palm oil and (explore) any other trade opportunities that Malaysia and Russia can work on together,” he added.

Meanwhile, the MPOF, organised by the Malaysian Palm Oil Council, attracted nearly 500 leading international stakeholders, including manufacturers, traders, non-governmental organisations and industry associations, to address critical challenges and opportunities shaping the future of palm oil.

With the theme "Navigating Trade Challenges with Sustainable Solutions," MPOF 2024 gathered nearly 100 oils and fats buyers from over 30 countries, providing them with opportunities to engage with local palm oil suppliers and source palm oil products for their respective markets and manufacturing sectors.

-- BERNAMA