India Edible Oil Prices Down On Weak Overseas, Rising Imports

MUMBAI (Dow Jones)--Indian edible oil prices fell this week due to weak overseas prices and expectations of a rise in
imports.

The price of crude palm oil declined to INR37,000 a ton Friday from INR37,700 last week, while that of refined soyoil
decreased to INR42,500/ton from INR42,800. The price of refined, bleached and deodorized palm olein slipped to INR40,000
a ton from INR40,300.

The benchmark August Malaysian crude palm oil contract on Bursa Malaysia Derivatives fell to MYR2,386 a metric ton
Friday, its lowest level this year, on expectations of a rise in output and stocks.

Indian edible oil prices mostly track overseas trends as the country imports nearly half of its annual vegetable oil
requirements.

"Domestic prices also fell because of fears of increasing imported edible oil supply as it is the lean crushing season
here," said a local trader.

India's soyoil imports in 2009-10 are likely to rise more than 50% from a year earlier to 1.5 million-1.6 million tons
as the premium over palm oil has narrowed down, Pradip Desai, managing director of Palmtrade Services Pvt Ltd., a
Mumbai-based importer, said Thursday.

Normally, soyoil commands a premium over palm oil because of its better quality, but the premium has narrowed down to
about $30-$40 a ton from about $100-$150/ton a year ago.

Also, India's MMTC Ltd. has issued a tender to import 6,000 tons of RBD palm olein for shipment in June.

India's total vegetable oil imports in the current marketing year through October are projected to rise to 9 million
tons from 8.66 million tons in 2008-09.

Thursday, the government increased the state-set price for soybean by INR50/100 kg to INR1,400, and of groundnut by
INR200/100 kg to INR2,300. But the Solvent Extractors' Association Friday said the increase is very minimal and that it
is seeking a higher state-support price to boost oilseed production in the country.

Sowing of India's summer oilseed crop fell 44% from a year earlier to 1.03 million hectares as of June 11, government
data showed Friday.

Planting of soybean, the main oilseed sown in the summer season, begins in June. The crop is harvested in October.

-By Swansy Afonso, Dow Jones Newswires; 91-22-22884212; swansy.afonso@dowjones.com

(END) Dow Jones Newswires
06-11-10 0828ET
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