India seeks sunflower oil alternatives
India, the worldâs top sunflower oil buyer, is rushing to secure supplies of alternate vegetable oils as attacks in the Black Sea region disrupt imports
India, the worldâs top sunflower oil buyer, is rushing to secure supplies of alternate vegetable oils as attacks in the Black Sea region disrupt imports and its own crops falter due to weak monsoon rains.With shipments from top producers Russia and Ukraine facing delays of up to 60 days and prices rising, according to traders, the country is turning to South American suppliers and to rival oils like palm and soy to plug the import gaps. Attacks in the Black Sea are âdefinitely affecting us,â said Mannan Khan, director of MK Agrotech Pvt. Ltd., a vegetable oil importer and distributor in the southern Indian city of Mysore. Dozens of his shipments, especially from Russia, have been delayed, he added.ALSO READ | India's edible oil imports to surge July-October as supplies shrink before festivalsThe company was forced to source half its sunflower supply from Argentina as violence in the Black Sea region intensified in the past month.
Khan is also âbetting onâ Australian canola oil, subbing it in for 3-4% of his firmâs total import volume, with plans to raise it further.The pivot is expected to help meet rising demand in India ahead of festival season starting next month. But it also stands to further tighten a global vegetable oil market already facing supply risks from a strong El Niño and higher biofuel demand, potentially lifting consumer prices.ALSO READ | India summons Ukraine envoy after Black Sea drone strike kills seafarerSunflower oil, used in cooking and biofuel, made up about a fifth of Indiaâs total vegetable oil imports in the first half of the year, according to the Solvent Extractorsâ Association of India. The majority â about 1 million tons â came from the Black Sea region.Ukraine has stepped up drone attacks on Russia-linked shipping infrastructure and vessels in the Black Sea, prompting Moscow to warn that itâs unsafe to navigate in the waters.
Meanwhile, the third-largest exporter of sunflower oil in Ukraine last week suspended operations, citing a sharp intensification of Russian missile and drone attacks on port and logistics infrastructure. Together, the two countries accounted for 63% of global sunflower oil exports last season, according to the US Department of Agriculture.The disruptions have pushed Indiaâs local sunflower oil price index up 6% this month, widening its premium over palm and soy.Demand is now starting to shift to rivals, according to Aashish Acharya, vice president at Patanjali Foods Ltd., one of the countryâs top vegetable oil buyers. Imports of palm oil are expected to jump around 40% on a monthly basis to 700,000 tons in July, while a higher-than-normal 500,000 tons of soy oil is expected to come in every month, he added.Meanwhile, Indiaâs own oilseed planting has lagged due to a below-average monsoon, according to official data.