Jakarta, May 22 - India will see vegetable oil consumption growing roughly 6 percent annually for the next eight years, lifted by healthy economic growth and an ever-expanding population, the country's top industry official said on Thursday.
India's vegoils demand may increase to 20.8 million tonnes in 2015 from 13 million tonnes estimated this year, B.V Mehta, executive director of the Solvent Extractors' Association of India, told a palm oil industry conference.
"India will continue to be a large importer of palm oil for quite some time ... because domestic output growth is unlikely to catch up with demand growth."
Mehta was referring to India's current position as the world's second largest buyer of vegetable oils after China, adding that imports of palm oil and soyoil will continue to account for up to 40 percent of total consumption in the South Asian nation of more than 1 billion people.
India's reliance on imports was evident when the government scrapped import duties on soyoil and palm oil in March, in a bid to cool rising food prices and improve domestic supplies.
And although efforts to improve yields and increase acreage for oilseeds are coming along amid surging international prices, supply concerns always remain an issue, Mehta said.
India grows two oilseed crops, mainly soybean and groundnut in the winter season, and rapeseed and groundnut in the summer season. These oilseeds often compete for acreage with wheat, cotton and pulses, which are generally favoured due to higher yields.
"The challenge of stagnating acreage, low yields and low production will have to be met successfully. Much will depend on the agricultural and pricing policies of the government," he said.
India has embarked on a slew of policies in May to control prices and ensure supplies from imposing stock limits on oilseeds and edible oils to halting futures markets trade in soyoil, rubber, chickpea and potato.
But prices of soyoil and rubber have soared following the suspension and traders say the imposition of stock limits will only push retailers to import more once the domestic crushing season ends.