Indian sunflower oil makers want the tension between Russia and Ukraine to be resolved smoothly so that the edible oil shipments can resume soon from the latter. They also said if the shipments do not come from Ukraine, then Russia and Argentina are alternate sources and there may not be any major impact on the retail prices of sunflower oil. But if there is a war between Russia and Ukraine, then the former may block the latter’s shipments. And if there are sanctions against Russia, then it will be a double whammy for India, the industry officials said, expressing hope that the situation doesn’t develop so.
At present, India imports about two million tons per month of sunflower seed oil, and at times it goes up to three million tons per month. India is dependent on edible oil imports to the tune of about 60 per cent. Any global development will have an impact.
Indian importers can look at alternate sources like Russia and Argentina. Like Ukraine, Russia is also a major grower of sun flowers and producer of sun seed oil. Seventy per cent of India’s sunflower oil imports are from Ukraine, 20 per cent from Russia and 10 per cent from Argentina.
Ukraine produces about 170 lakh tons of sunflower seeds, Russia about 155 lakh tons and Argentina about 35 lakh tons. The oil yield will be about 42 per cent when crushed.
The price of oil sold by these two countries—Ukraine and Russia—is almost the same. The global price ranges from about $1,500 to $1,525 per ton.
Though there is sufficient stock of sunflower oil in India for the next two months, for the past 20 days, shipments from Ukraine were getting delayed and the vessels were getting bunched up. If the Russia-Ukraine trouble continues for two or three more weeks, there will be pressure on the Indian market as the oil stocks will not be replenished. Around 1.5 lakh – 2 lakh ton of sunflower seed oil imported between February and March are expected from Ukraine, but not a single shipment of sunflower oil has left Ukraine in February.
South India is the major market for sunflower oil. According to the Indian Embassy in Ukraine, India’s bilateral trade turnover was $2.52 billion in 2019-20 (exports were $463.81 million and imports were $2,060.79 million).