India Looks into Jump in Refined Palm Oil Imports from Malaysia

India has initiated a probe into whether a jump in refined palm oil shipments from Malaysia is causing serious injury to domestic industry, the trade ministry’s investigative arm said in a statement, reported the New Straits Times on August 18.  Malaysian exports of refined palm oil to India, the world’s biggest importer of edible oils, jumped 727 percent in the first half of 2019 to 1.57 million tons compared with the same period a year before, according to data compiled by the Malaysian Palm Oil Board (MPOB).  

In January, New Delhi cut import duty on refined palm oil shipments to 50 percent from 54 percent.  Malaysian shipments already attracted only a 45 percent duty due to the Comprehensive Economic Cooperation Agreement signed by the two countries nearly a decade ago.  The change in duty structure reduced the effective duty difference between crude palm oil (CPO) and refined palm oil for Indian refiners to 5.5 percent from 11 percent for shipments from Malaysia, making overseas buying of refined palm oil more lucrative than CPO.

Rising shipments of refined palm oil have hit local refiners, alleged the Solvent Extractors’ Association of India (SEA), which has filed an application with the Directorate General of Trade Remedies (DGTR) for the investigation.