India's soyoil imports will shrink further as a new import tax prompts buyers to shift to palm, traders and industry officials said on Wednesday. But farmers harvesting the domestic soybean crop are expected to get higher oilseed prices ahead of next year's general elections after the government imposed a 20 percent import tax on crude soyoil on Tuesday, they said.

 

"Whatever little soyoil we import will get reduced further as crude palm oil will be cheaper. Soyoil is hardly 10 percent of our total vegetable oil imports," said Ashok Sethia, president of the Solvent Extractors' Association of India (SEA).

 

By the midday break, the benchmark February palm oil contract on the Bursa Malaysia Derivatives Exchange was at 1,467 ringgit per tonne, up 31 ringgit, as India's decision to slap import duty on rival soyoil spurred trade.