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MUMBAI – The share of palm oil in India’s growing edible oil imports is likely to plunge to a record low this marketing year as a rally in prices slashes its discount over rival soyoil.

That shift in the world’s top palm oil importer could drag on benchmark prices for palm oil that have surged around a third in the last 12 months, while bolstering markets for soyoil.

Edible oils are a common ingredient in Indian cuisine, used in everything from curries to samosas, with soyoil seen as more healthy than palm.

“Palm oil discounts are consistently reducing over soyoil. At the current price level, Indian refiners are inclined to switch to soyoil,” said Govindbhai Patel, managing director at edible oil trading firm GG Patel & Nihil Research Co.

Palm’s discount to soyoil has more than halved to $70 per tonne, from $171 in August 2015, according to data from Mumbai-based trade body the Solvent Extractors Association of India (SEA).

India’s overall edible oil imports are expected to rise 1.4 percent in the 2015/16 marketing year that ends in October to 14.6 million tonnes due to rising consumption, Patel said, but palm imports will drop 12 percent to 8.4 million tonnes.

That will crimp palm’s share of total edible oil imports to 57 percent – the lowest since India eased restrictions on such imports in the early 1990s. Palm oil’s share of India’s edible oil imports stood at 66 percent last year, down from 86 percent in 2007/08.

India’s monthly palm oil imports fell to 570,051 tonnes in July, the lowest since February 2015. And soyoil imports have jumped as palm purchases have faded.

The country has so far in 2015/16 imported a record 3.1 million tonnes soyoil and total purchases in the year to October are set to rise to 4.25 million tonnes, up 42 percent from last year’s 3 million tonnes, Patel said.

India mainly imports palm oil from Malaysia and Indonesia, while its soyoil comes from Argentina and Brazil.

“In coming months, palm oil prices have to fall to remain competitive against soyoil,” said an official with a leading edible oil refinery based at central Indian city Indore. He asked not to be identified as he is not authorised to speak with media.

“Otherwise palm oil exports will fall gradually and inventory will build up in peak producing months.”