Ind-Ra says high palm oil prices are shifting demand to soybean oil in OY25, while Indonesia’s push toward higher biofuel blending could tighten global supplies in 2026
India’s soybean oil imports are set to rise sharply in the 2025–26 oil year as higher crude palm oil (CPO) prices continue to shift demand toward soft oils, India Ratings and Research (Ind-Ra) said on Friday.
Soybean oil arrivals are forecast at 4.7 to 4.9 million tonnes in OY25, up about 40 per cent from a year earlier. Total edible oil imports are expected to dip only marginally to around 15.5 million tonnes.
Palm oil imports are likely to fall to about 8 million tonnes from 9 million tonnes in OY24 after shipments dropped 15 per cent year-on-year to 7 million tonnes in the first 11 months of the current oil year. Palm’s share in India’s edible oil basket slipped to 50 per cent from 56 per cent.
“While CPO prices are likely to soften in 2026 with an increase in the output, the increase in biofuel blending in Indonesia might affect the demand-supply balance in the later part of 2H26, presenting an upside risk,” said Khushbu Lakhotia, Director, Corporate Ratings at Ind-Ra.
Soybean oil imports reached 4.4 million tonnes in the first 11 months, with September shipments at 0.5 million tonnes, the highest since mid-2022. Sunflower oil arrivals fell 20 per cent to 2.6 million tonnes; full-year volumes are seen at 2.8 to 2.9 million tonnes versus 3.5 million tonnes a year earlier.
Lakhotia said “soybean oil prices faced downward pressure with Argentina suspending export duties and the US facing a lack of demand from China,” adding that China’s buying could improve after Washington cut tariffs.
Indonesia’s shift toward higher biodiesel blending ratios, including a planned B50 mandate in 2026, could absorb an additional 5 million tonnes of palm oil, tightening exportable supplies. CPO import prices rose 9 per cent year-on-year to USD1,164 a tonne in September, while sunflower oil averaged about USD1,300, up 20 per cent.
India’s edible oil import dependency is expected to stay around 55 per cent in OY25. Refining margins have improved after India widened the duty differential by cutting crude edible oil duties to 16.5 per cent in May while keeping refined duties unchanged.
