InfoSAWIT, MUMBAI – Indian vegetable oil refiners are holding back purchases of palm oil, soybean oil, and sunflower oil, betting that recent price increases driven by geopolitical tensions will not last.

Industry players told Reuters that buyers are adopting a wait-and-see approach, expecting prices to decline once tensions ease.

As the world’s largest vegetable oil importer, India’s cautious stance could limit gains in Malaysian palm oil and U.S. soybean oil prices, while supporting domestic oilseed farmers.

Previously, palm oil prices surged to their highest level in over a year, driven by rising crude oil prices amid Middle East tensions, which boosted biodiesel demand.

However, market participants in India believe the rally is temporary.

“There is no need for panic buying. Global supplies are sufficient, and prices will fall sharply once the conflict ends,” said a senior executive at a leading importing firm.

India’s vegetable oil imports are projected to fall to around 1.1 million tons in March, down from an average of 1.36 million tons per month.

Palm oil imports alone are expected to drop to about 680,000 tons from 847,689 tons in the previous month.

Sunvin Group CEO Sandeep Bajoria said Indian buyers are currently staying on the sidelines.

“Some buying interest may return if palm oil prices correct, but overall sentiment remains cautious,” he noted.

Ample inventory from previous imports, along with rising domestic rapeseed production, has reduced short-term dependence on imports.

With these factors in play, global vegetable oil markets are expected to move cautiously, with India playing a key role in shaping price direction. (T2)