Based on soya oil which is coming from major oil producing economies like Argentina and Indonesia, the US has recently decided on to hike the import duties on the biodiesel. In coming months, the Indian soya oil refiners and traders of India might gain from the cheaper imports.
By US government, the import duty on biodiesel from Argentina was increased from 50.29% to 64.77%. The Indonesian biodiesel import duty was also increased from 41.06% to 68.28%. For safeguarding their local refining and crushing industry, the US government has taken this decision.
To the US a large part of their produce has been sold by both Argentina and Indonesia. By the US this hike in import duty will make the availability of soy oil increase in the international market and also Indian industry feels that after this it will push the rates down. This will help the Indian oil refiners who want better edges, especially after the Indian government raised the import duty on refined oil to enhance nearby firms that buy oilseeds from regional farm owners and also to increase the employment of capacity.
It is expected that to increase soy oil import in their imports of edible oil by about 10%, the move by US government will also help the Indian edible oil industries. Followed by soya oil, the Indian edible oil import pie, palm oil has the largest share of about 25%. Some analysts also have a view after seeing the tax benefits and subsidies provided by the government of Indonesia and Argentina, the soya oil import by India may rise by 5-10%.
The Indian Soybean Processors Association chairman told that as they can improve margins by cheaper imports and also lower their prices, so the firms into direct retailing will benefit out of this.