Sunflower oil prices increaseDate: 26 March 2022 Tags: Basics of Economics
The edible oil prices have risen by 20-30 percent in March owing to the conflict between Ukraine and Russia.
India is a major importer of cooking oil. This includes palm oil, sunflower, and soybean oil etc.
Data showed that prices rocketed by 70 percent year on year basis. The prices are further expected to grow as end to the war looks uncertain.
There are fears of supply chain distortion that can further push up the price of sunflower oil in international market.
Importance of Ukraine and Russia
Russia and Ukraine accounts for 60 percent of the global sunflower oil production and exports.
The Black Sea region contributes 60 percent of world sunflower oil output, which has been affected due to closure of ports.
India is the top importer of edible oil. Russia and Ukraine export five lakh tonnes of sunflower oil to India annually.
Domestically produced mustard and groundnut seeds are expected to cool down the prices and prevent sunflower oil prices from hitting the roof.
It is expected that prices may rise by 5-10 percent in future as demand and supply oscillates. The scrapping of basic customs excise duty has given some relief.
Oil import dependency in India
India imports more than 60 percent of its edible oil requirements. This is about 13 million tonnes out of total consumption of 22-23 million tonnes.
Sunflower oil accounts for 15 percent of India's total imports. Ukraine is the largest exporter of sunflower oil in the world.