Refined palm oil cargoes stuck at Indian ports after import curbs: Sources

Thousands of tonnes ofrefinedpalmoilare delayed orstuckat variousIndianportsafterthe world's biggest edibleoilbuyer placed restrictions on importsamid a diplomatic row with key supplier Malaysia, multiplesourcestold Reuters.

India announced thecurbson importsofrefinedpalmoilon January8 in a bid to help domestic refiners raise their plant utilisation rates, according to industry officials familiar with the matter. In a typical year, India relies on importsfor almost all of its supply of the vegoilused in everything from soap to cookies.

But Malaysia, the world's second-biggest producer and exporter ofpalmoil, has publicly bridled at New Delhi's move even as India has stepped up orders from Indonesia, according to Refinitiv data. India has been its biggest market for the last five years, and the row sent benchmark Malaysianpalmfutures to their worst weekly fall in more than 11 years on Friday.

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"More than 30,000 tonnes have beenstuckat various (Indian)ports. All these vessels were loaded before the government restricted importsofrefinedpalmoil," said a Mumbai-based vegetableoildealer, who declined to be named citing company policy.

"Usually customs officials allow unloading of commodities that are in transit before any change in regulation. But in the case ofrefinedpalmoil, there is some confusion and that is leading to delays."

A source in New Delhi with direct knowledge of the matter said the restrictions meanimporters will need a license to buy, a tool that could be used to deny or delay shipments from Malaysia. The person declined to be identified citing the sensitivity of the matter.

Another vegetableoilimporter said some vessels werestuckat Kolkata port in eastern India, with some others on the west coast. In one incident at Mangalore port on the west coast, crudepalmoilwas unloaded from a vessel, whilerefinedoilwas not permitted ashore, said theimporter, who also declined to be named citing the sensitive nature of the situation.

Reuters could not ascertain which vessels contained thecargoesthat have been held up at Kolkata and Mangalore, nor who the buyers were. A source in Kuala Lumpur, who requested anonymity citing the sensitivity of the matter, said therefinedpalmoilwas from both Indonesia and Malaysia.

Officials at Kolkata and Mangaloreportsdid not immediately respondto anemailseeking comment.

Malaysia's Sime Darby Plantation, the world's largestoilpalmplanter by land size, said none of itsrefinedpalmoilwasstuckatIndianports. The company, which has operations in both Malaysia and Indonesia, exported more than 436,000 tonnes ofrefinedpalmoilto India last year.

Sudhakar Desai, president ofIndianVegetableOilProducers' Association, saidrefinedpalmcargoesthat reached before the restrictions were placed had been cleared but noneafterthat.

"We don't think any licenses have been issued for any origin," Desai said.

A spokeswoman for India's trade ministry did not immediately respond to an email from Reuters seeking comment.