InfoSAWIT, ISLAMABAD – Pakistan imported a record 3.482 million metric tons of palm oil during fiscal year 2026, reflecting the country's growing dependence on overseas edible oil supplies as domestic demand continues to outpace local production.
According to InfoSAWIT, citing Propakistani on Sunday (August 2), data released by the Pakistan Bureau of Statistics (PBS) showed that palm oil imports reached US$3.785 billion, up from 3.214 million tons worth approximately US$3.4 billion recorded in FY2025.
The average import price also increased, rising to around US$1,078 per ton compared with US$1,056 per ton a year earlier.
The surge was largely driven by expanding domestic consumption of cooking oil and ghee, fueled by population growth and declining production of local oilseed crops.
Sheikh Umer Rehan, Chairman of the Pakistan Vanaspati Manufacturers Association (PVMA), said Pakistan's annual edible oil consumption has climbed to nearly 4.8 million tons, compared with around 4 million tons five years ago.
Meanwhile, domestic feedstock production—particularly cottonseed—has continued to decline, forcing manufacturers to rely increasingly on imported palm oil to meet demand.
Despite the industry's steady growth, Rehan argued that Pakistan still lacks a long-term national strategy to develop its edible oil sector.
He also criticized recent tax reforms introduced by the Federal Board of Revenue (FBR), which are shifting the General Sales Tax (GST) calculation from the ex-mill price to the Maximum Retail Price (MRP).
According to Rehan, the policy will increase compliance costs and create additional administrative burdens for manufacturers rather than improving the business environment.
PVMA estimates the new taxation mechanism, introduced under the FY2027 budget, could raise retail prices of cooking oil and ghee by Rs10–15 per kilogram.
The expanded Third Schedule under the new fiscal policy effectively moves tax collection to a retail-price basis, a change industry groups believe will significantly increase tax liabilities.
Manufacturers have repeatedly urged the government to reduce the tax burden on edible oils in order to help preserve consumers' purchasing power amid rising food costs.
Official Sensitive Price Index (SPI) data already show higher retail prices over the past year. Five-liter packs of cooking oil now sell between Rs2,975 and Rs3,110, while 2.5-kilogram ghee packs have increased to around Rs1,500–Rs1,565.
Pakistan's record imports further reinforce the strategic importance of major producing countries, particularly Indonesia and Malaysia, in supplying the global vegetable oil market. As Pakistani consumption continues to expand, stable palm oil supplies and competitive pricing are expected to remain key factors shaping regional trade. (T2)
