India's Sunflower Oil Imports Could Jump To Record As Prices Dip Below Soyoil
India's imports of sunflower oil could rise to a record in 2021/22 as potential bumper crops in Russia and Ukraine pull prices below rival soyoil, making it lucrative for price-sensitive buyers from the subcontinent, industry officials said.
India is the world's biggest importer of edible oils and higher purchases of sunflower oil could help exporters such as Argentina, Russia and Ukraine to dispose of surplus output.
Higher sunflower oil imports could cap India's purchases of soyoil and palm oil, however, and weigh on prices of those commodities.
"Sunflower has become very competitive due to expectations of a bumper new crop," said Sandeep Bajoria, the president of trade body the International Sunflower Oil Association.
"India's imports will increase in coming months."
Crude Sunflower Oil
Crude sunflower oil is being offered at about $1,280 a tonne, including cost, insurance and freight (CIF) for shipments in the December quarter to India, lower than the $1,330 cost of degummed soybean oil, traders said.
A year ago, sunflower oil was fetching a premium of up to $100 over soyoil, which led to lower sunoil consumption.
As sunflower oil is now trading at discount to soyoil, imports will rise and consumption could rebound in southern and western India, said Sudhakar Desai, president of the Indian Vegetable Oil Producers' Association (IVPA).
"The rise in sunflower oil imports could marginally reduce soyoil and palm oil imports," Desai said.
Traditionally, palm oil makes up nearly two-thirds of India's total edible oil imports, while soyoil and sunflower account for 20% and 16%, respectively.
India's total sunflower oil imports for the marketing year starting November 1 could jump 37% to a record 2.6 million tonnes, Bajoria said, up from 1.9 million tonnes in 2020/21.
India imports sunflower oil mainly from Argentina, Russia and Ukraine.
Anticipating big new crops, traders have slashed prices for August shipments of old crop supplies, and India's imports in the month could rise to 200,000 tonnes from 175,702 tonnes in June, said a dealer based in Mumbai with a global trading firm.
"During peak crushing season sunflower oil prices could fall further," the dealer said.
"If palm oil prices fail to come down, then a lot more sunflower oil could come to India substituting palm oil."
Sunflower oil's premium over palm oil has reduced to $100 per tonne from $160 a year ago, traders said.