Edible oil refiners in Nepal have all but stopped buying crude palm oil amid surging domestic stockpiles after top buyer India suspended most imports of refined oil from the country, industry officials told Reuters.
New Delhi in May suspended 39 oil import licences to slow duty-free shipments from neighbouring nations, disrupting refiners in Nepal which had thrived thanks to preferential access to India’s huge market.
“Refiners are not importing fresh crude palm oil but we have to take (delivery) of the stock which is in transit,” said Amit Sarda, director at Pashupati Oil Industries, a leading refiner and exporter based at Nepal’s industrial town of Biratnagar.
Palm oil stockpiles in Nepal have swelled to 70,000 tonnes, overwhelming local demand needs, he said.
As a result, Nepal’s crude palm imports had plunged to less than 7,000 tonnes per month by mid June from around 21,000 tonnes earlier in 2020, according to government data.
India accounts for nearly two-thirds of Nepal’s trade and is its sole fuel supplier. The ties between Nepal and India have strained lately following a territorial dispute.