Black sea deal off- Crude sunflower import price rise 10%

Black sea deal off: Crude sunflower import price rise 10%

With the discontinuation of the Ukraine and Russia black sea deal, the landed prices of crude sunflower oil has risen by 10% to $1050/tonne on July 21 against $ 960/tonne a week back.

Although current sunflower import prices are still 35% below the last year’s high of $ 1413/tonne, industry sources told FE that supply disruption in Ukraine, which has about 30% share in edible oil variety imports could push up prices.

In the current oil year (Nov, 2022 – June, 2023), out of the total crude sunflower oil import of 1.85 million tonne (MT), the share of Russia and Ukraine is 40% and 30% respectively.

Last year Russia had allowed export of commodities from war-torn Ukraine through black Sea which had improved global supplies of sunflower and wheat.

The edible oil import during November, 2022 – June, 2023 rose by 12% to 10.36 million tonne (MT) compared to same period in the previous year. Major chunk of imports include palm (44%) , soybean (24%) and sunflower (18%).

“With rising prices of sunflower oil, imports of palm oil could see an increase in the coming months,” BV Mehtra, executive director, Solvent Extractors Association of India, told FE.

The landed prices of palm oil (at Mumbai port), which has highest share in imports of edible oil, declined by 13% to $970/tonne on July 24 this year, against the $1,1120/tonne that prevailed a year ago.

At present, crude palm, soybean and sunflower oil imports attract only a 5% agri infra cess and a 10% education cess, meaning a total tax incidence of 5.5%.

India imports about 56% of its annual edible oil consumption of 24-25 MT. About 8 MT of palm oil is imported from Indonesia and Malaysia annually.

Inflation in the oil and fats category declined by 18.12% in June 2023.

Farmers’ organisations and edible oil processors have been urging the government to hike import duties to bring parity with domestic edible oil prices.

The share of domestic edible oil includes mustard (40%), soyabean (24%) and groundnut (7%) and others.