India’s imports of edible oil likely to jump by $ 2 billion this year

India’s import bill for edible oils is likely to jump by $2 billion, following the sharp rise in prices after Russian attack on Ukraine, reports Financial Express. Supply disruptions caused by the conflict in Ukraine have pushed up sunflower prices from $1,500 per tonne to $2,050 per tonne. Soya oil is now trading at $1,800 per tonne from $1,500 per tonne prior to the war, while palm oil is up from $1,400 per tonne to $1,700.

India has contracted 45,000 tonnes of sunflower oil from Russia and another 20,000 tonnes of sunflower from Argentina for the current month at $2100 per tonne. The ongoing conflict between Russia and Ukraine has pushed up edible oil prices sharply in the March quarter. Prices had shot up to $2,200 per tonne right after the attack but have cooled down with Russia and Argentina increasing supply.

India imports 130 lakh tonnes of oil annually. The normal cost of this would have been $18 billion but due to invasion, the import bill has gone by $20 billion, claim industry players. The country used to import 2 lakh tonnes of sunflower oil per month, but it will receive close to 1 lakh tonne only this month. Users are likely to switch over to soya or palm oil or local domestic oil like rice brand and ground nut oil.

Refined sunflower oil constitutes 10% of India’s consumption of 230-240 lakh tonne of edible oils (all types) annually. The country imports nearly 60% of its edible oil requirement. Around 90% of India’s annual crude sunflower oil requirement of 22-23 lakh tonne comes from Ukraine to the tune of 70% and 20% from Russia and the remaining 10% from Argentina. For the current oil year starting from November 2021, volume wise, the highest import has been of palm oil. Out of 130 lakh tonnes annually around 80 lakh tonnes is palm oil, 35 lakh tonnes is soy oil and sunflower oil is around 15 lakh tonnes.

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