MUMBAI: Edible oil prices have slid in the physical market over the past one month due to fall in crude palm oil (CPO) prices globally.

CPO constitute a major share of India’s edible oil imports which are up by 13% at over 30 lakh tonne for eight months from November 2007 to June 2008 compared to a year ago. The bulk prices of refined palm oil, refine soyabean oil and mustard oil are down between Rs 6 and Rs 8 per kg in the local markets.

According to data provided by the Solvent Extractors Association, the price of imported CPO (ex-Kandla) in local rate is down to Rs 44,000 per tonne from Rs 51,600 on July 1. Crude degummed soyabean oil (ex-Mumbai) is down to Rs 58,500 per tonne from Rs 65,000. Internationally crude palm oil (FOB Indonesia) has dropped to $980 per tonne from $1,145 on July 1, while soya degummed crude is down to $1,333 per tonne from $1,500 on July 1. The global fall in CPO is the follow-up of the falling crude oil price and good palm oil stocks in Malaysia.

Since the domestic crop of soyabean will arrive only in October and mustard crop arrivals are over, it is the movement in the global market that is impacting local prices.

Sanjay Agarwal, MD of Madhya Pradesh-based KS Oils said that in the near term domestic prices will be governed by global prices. He said that even in October when the local soyabean crop is harvested, the edible oil prices will hinge on demand for oilmeal from China and crude oil price.

Following palm oil and soya oil even the mustard oil prices have come down by Rs 5 to Rs 6 per kg at Rs 77 per kg. Mustard arrivals started in February and prices were firm due to low production estimated at 50 lakh tonne as against 58 lakh tonne in the previous year.

On futures front, CPO September contract on MCX closed down at Rs 444 per 10 kg on Tuesday. This contract is down 14% since July 1. Soyabean September on NCDEX closed down at Rs 2,490 per quintal, down 6.7% since July 1 and rape mustard seed closed down at Rs 622 per 20 kg, down 8% since July 1.

Angel Commodities research analyst Badruddin said that in short term the prices of edible oil complex are down but in long terms they will recover due to festive demand.

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This entry was posted on Wednesday, July 30th, 2008 at 9:55 am and is filed under Palm Oil World News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.