Edible oil prices set to soften as China slaps extra 10 pc import duty on US soya

Edible oil prices are set to soften in the April-June quarter as China has imposed an additional tariff of 10% over and above the 25% import duty on soya bean imports from the US.

The move has led to a decline of $50 per tonne in global soya oil prices in the past three days and has put pressure on other oils such as sunflower and palm oil, whose prices have dropped too.

"Even though India does not import huge quantities of soya bean oil from the US, the Chinese announcement has created a negative sentiment in the market and has brought down prices of the entire edible oil complex," said Sandeep Bajoria, CEO of Mumbai-based Sunvin Group, an oil trading firm. "Due to higher import duty, US soya bean exports to China will reduce and the availability of soya bean in the global markets will go up. This is hurting soya bean oil prices, which have already gone down to $1,100 per tonne from $1,150 per tonne three days back."

Sunflower oil prices have fallen to $1,150 per tonne from $1,190 per tonne and palm oil to $1,200 per tonne from $1,240 per tonne in the past three days.

Angshu Mallick, managing director of Adani Wilmar, said, "Edible oil prices will soften in the April- June quarter as the imported oils at a lower price will land by the third week of March and will be distributed in the market in April. We do not see prices firming up in the first quarter of 2025-26. Prices are expected to stabilise on the lower side."

According to industry executives, oil prices will soften by 4% in April from the current levels. "We are expecting a fall of ₹4 per kg," said Bajoria.

He also indicated that there might be a further fall in imported oil prices in the coming weeks. A kg of soya bean oil costs ₹150 -155 at present.

India imports more than 65% of what it consumes.