August 26: Soybean oil has taken the place of refined palm oil as Nepal’s chief export product after India imposed a ban on import of palm oil from Nepal since the last four months.

According to the data kept by the Department of Customs, Nepal exported soybean oil worth Rs 2.27 billion in the first month of the current fiscal year. India is the major market of soybean oil produced in Nepal. The export of soybean oil to India in the first month of FY 2020/21 increased by five folds compared to the export during the corresponding period of the previous fiscal year.

In the first month of FY 2019/20, Nepal had exported soybean oil worth Rs 450 million to India.

During the last fiscal year, refined palm oil topped the list of products exported to India from Nepal. In FY 2019/20, Nepal exported refined palm oil worth Rs 19.31 billion to India.

However, the Department of Foreign Trade of India in May revoked the license of palm oil importers in the country due to which Nepali exporters were unable to sell the product in the Indian market.

According to the operator of OCB Foods, Suresh Rungata, his industry has scaled up manufacturing soybean oil after India halted the export of palm oil from Nepal. He informed New Business Age that soybean oil accounts for more than 50 percent of the total production in the industry.

“We opted for production of soybean and sunflower oils as an alternative to palm oil after India imposed the ban,” says Rungata.

Pradeep Muraraka, a businessman based in Biratnagar, says the demand for soybean oil has been increasing in the recent days.

“Although all industries are not operating in full capacity due to coronavirus pandemic, those that are operational have received high demand for soybean oil,” said Muraraka.

Industries in Nepal basically import crude soybean oil from Argentina, Brazil, Paraguay, Indonesia and Ukraine. They then refine the oil and export it to India and third countries.

Besides soybean oil, other major export products of Nepal in the first month of the current fiscal  year were tea, cardamom and carpet.