India's edible oil imports reached 151.64 lakh tonnes in the first 11 months of the 2025-26 oil year, a 3.27% increase. While total intake grew, domestic refiners are shifting toward processing raw crude instead of importing finished products. However, rising global commodity prices and the rupee's decline against the dollar are increasing costs, which could put pressure on profit margins for the food processing industry.
India’s edible oil import volume grew by 3.27% during the first 11 months of the 2025-26 oil year, totaling 151.64 lakh tonnes. This increase from 146.83 lakh tonnes in the previous period highlights the country's continued dependence on international markets for its edible oil needs. A notable change in this year's import data is the composition of these shipments, which signals a shift in how the domestic industry operates.
Shift Toward Crude Oil Processing
The most significant trend in the latest data is the sharp drop in imports of refined edible oils, which fell to 7.40 lakh tonnes from 16.89 lakh tonnes in the same period last year. This suggests that Indian refiners are increasingly choosing to import raw crude oil and process it domestically, rather than purchasing finished oils. This shift is generally positive for domestic refining companies as it allows them to utilize their machinery and refining capacity more effectively. In contrast, crude oil imports rose significantly to 144.23 lakh tonnes compared to 129.93 lakh tonnes in the previous period.
Palm Oil Dominance and Trade Dynamics
Palm oil continues to be the dominant choice for Indian importers, with total shipments reaching 73.52 lakh tonnes, a 5.32% increase. Argentina has emerged as a top supplier, providing 34.43 lakh tonnes, largely consisting of crude soybean and sunflower oils. Meanwhile, Malaysia and Indonesia remain key suppliers for palm oil, contributing 29.76 lakh tonnes and 29.05 lakh tonnes, respectively.
However, a competitive challenge remains for domestic players regarding imports from Nepal. Under the South Asia Free Trade Agreement (SAFTA), Nepal exported 6.82 lakh tonnes of refined oils to India duty-free. This creates a difficult environment for local Indian refiners, who must compete with these cheaper imports that do not attract the same duties as crude oil.
Currency and Commodity Pressures
Beyond import volumes, domestic food processors are facing headwinds from global price trends and a weaker Indian rupee. As of September 2026, global prices for edible oils saw double-digit increases. Crude sunflower oil prices rose 10.8% to $1,432 per tonne, while crude soybean oil increased 11.2% to $1,314 per tonne.
Compounding this cost pressure is the depreciation of the Indian rupee against the US dollar, which weakened to 95.51 from 88.32. Because India imports a large portion of its edible oil, a weaker rupee increases the landed cost of these raw materials. For investors, the key monitorable will be whether companies can pass these higher costs on to consumers through price hikes or if they will have to absorb the costs, which could lead to lower profit margins in upcoming quarterly results.