Sunflower oil prices have shot up by 20% as the Russian invasion of Ukraine has destroyed grinding and processing units in the war-ravaged country. This is expected to further rise as the war in Ukraine shows no signs of ending. 

Sunflower oil imports from Ukraine, the world’s largest producer, have completely stopped as no ports are working. 

India is able to get some oil from Argentina and Russia, but this is way below the import of 200,000 tonnes of oil. “In February, we managed to get 150,000 but in March we may get only 60,000 tonnes of oil,” International Sunflower Oil Association president Sandeep Bajoria said.

 Consumers are hard hit as edible oil prices in general have surged 20-30% in March alone, while the year-on-year rise is around 70%.

 Supply disruption has hit sunflower oil, which is already up $400-450 a metric tonne over the year. 

“Interior infrastructure of the sunflower farms and crushing plants is disturbed. Damage to the property has crippled production and movement so it may take a few months for supplies to normalise,” Bajoria added.

 About 300,000 tonnes of oil is in Ukrainian port but it cannot be loaded. “Five ships are ready to come to India but no one is taking chances,” Bajoria said, adding that people have to shift to other kinds of oil like soyabean and groundnut.

 In Russia, two ports are working which are now catering to prior commitments. Some amount of oil is coming but the fresh vessels are not ready to go to the Russian area. Getting insurance and letter of credit are problem areas.

 "India imports nearly 2.5 million tonnes of sunflower oil. Of this, 70% comes from Ukraine, 20% from Russia and the rest from other countries including Argentina,” said Kedia Advisory director Ajay Kedia. 

“The prices will shoot up because the imports have stopped. India’s

own sunflower production has been stagnant for the past few years at around 60,000 tonnes (2019-20), which is grown on around 2.40 hectares,” Kedia added.

 India’s total edible oil consumption was 25 million tonnes. While the domestic availability was 10.53 million tonnes, the remaining 14.47 million tonnes was imported. Sunflower oil constituted 17% of the total import of all the edible oils.

  India imported 2.5 million tonnes of sunflower oil in 2019-20 and 2.2 million tonnes in 2020-21. The import from Ukraine accounted for 1.93 million tonnes in 2019-20 and 1.74 million tonnes in 2020-21.

 The import from Russia comprised 0.38 million and 0.28 million tonnes in these two years.

. Refiners have about 35 to 45 days of stock. Only the high-end consumers are going to stick to sunflower oil while the others are going to switch over to soyabean and groundnut oil.

 Meanwhile, India is looking to import crude sunflower oil from Mercosur countries. This will require a cut in the import duty on sunflower oil originating from Mercosur countries.