India is exploring Mozambique as a new source of oilseeds and vegetable oils as it seeks to diversify import origins and reduce its exposure to global supply disruptions. The Solvent Extractors’ Association of India (SEA) and the Government of Nampula Province in northern Mozambique signed a Statement of Interest to explore a sustainable oilseed and vegetable oil corridor.
Three-year framework for oilseed supply
The agreement was signed at the Globoil India conference in Mumbai by Nampula Governor Eduardo Mariamo Abdula and Angshu Mallick, President of SEA and Executive Deputy Chairman of AWL Agri Business Limited. Dr Shatadru Chattopadhyay of Solidaridad Network Asia and Dr Jonathan Atkinson of Solidaridad Southern Africa also signed the agreement as sustainability partners. SEA Executive Director Dr B. V. Mehta was present.
The three-year exploratory agreement will examine opportunities for commercial investment, local processing and traceable sourcing of oilseeds and vegetable oils. Groundnut, soybean, sesame and oil palm are among the crops being considered.
India is the world's largest importer of vegetable oils. During the 2024-25 oil year, it imported more than 16 million tonnes valued at over Rs 1.8 lakh crore, meeting around 60% of domestic consumption.
Diversification of import sources
India's edible oil imports are currently concentrated among a limited number of origins. Palm oil is mainly sourced from Indonesia and Malaysia, soybean oil from Argentina and Brazil, and sunflower oil from Russia and Ukraine.
According to the initiative's framework, such concentration can leave India's supply chain vulnerable to geopolitical tensions, trade restrictions and global supply shocks. With national vegetable oil demand projected to reach 46.5 million tonnes by 2047 and domestic production unlikely to meet the requirement, India is looking for additional supply partners.
Nampula offers a potentially complementary source. The province has extensive arable land, suitable soils and climatic conditions for growing groundnut, soybean, sesame and oil palm.
Port connectivity offers logistical advantage
Nampula is located along the Nacala Development Corridor and has road and rail connectivity to the deepwater Port of Nacala on the Indian Ocean. The location could provide a relatively direct shipping route to India's west coast compared with supplies originating in South America, potentially reducing transit times and freight costs.
Mozambique's existing pulse trade with India also provides an established commercial relationship between the two countries.
The proposed partnership is not limited to exporting raw oilseeds. It envisages developing crushing and refining infrastructure in Nampula so that greater value can be retained locally. Governor Abdula highlighted the potential for local processing to generate employment, particularly for young people, and strengthen the province's agricultural economy.
Focus on smallholders and sustainability
Solidaridad Network Asia and Solidaridad Southern Africa will oversee social and environmental safeguards. These will cover smallholder farmer empowerment, water management, protection of land rights and ensuring that agricultural expansion takes place only on degraded or already converted land.
Smallholder farmers currently cultivating oilseeds with limited access to high-value markets are expected to be integrated into formal value chains.
Feasibility study precedes commercial investment
Each party will nominate representatives to a Joint Working Group within 15 days. The group will undertake feasibility studies covering soil suitability, transport infrastructure, port capacity, market costs and environmental impacts.
A delegation of SEA member companies is scheduled to visit Nampula in the first quarter of 2027 at the invitation of the Mozambican government. The delegation will assess farmland, infrastructure and the Port of Nacala, with the findings expected to inform subsequent commercial agreements.