India buys record amount of sunoil amid Ukraine-Russia price war
24/06/2024 (Bangkok Post), Mumbai - Indians bought a record 500,000 metric tons of sunflower oil for June delivery, as competition between leading suppliers Russia and Ukraine made it cheaper than soyoil and palm oil, two leading buyers and a customs official told Reuters.
Higher sunflower oil purchases by the world's biggest importer of vegetable oils will help to reduce sunflower oil inventories in the Black Sea region and lift sunoil prices.
A leading buyer who declined to be named said sunoil was trading at a discount to soyoil and even palm oil, which was tempting Indian buyers especially given robust demand in southern states.
A few weeks ago, crude sunoil was available at $940 a metric ton, including cost, insurance and freight (CIF), in India for June delivery, while soyoil and palm oil were offered around copy,015 and $950 a ton, respectively, dealers said.
Sunoil usually holds a premium of more than copy00 per ton over soyoil and palm oil, Rajesh Patel, managing partner at edible oil trader and broker GGN Research, said.
Russia and Ukraine, as well as another big supplier Argentina, were aggressively competing and offered sunoil at a lower price than other oils, another buyer based in Hyderabad said. He has reduced palm oil and soyoil purchases to make space for sunoil.
The currencies of Russia and Ukraine have depreciated since the war started in February 2022, allowing them to offer sunflower oil at competitive prices in dollar terms, the buyer said.
Russia and Ukraine account for more than 70% global shipments of sunoil.
Around 320,000 metric tons of sunflower oil have been discharged at various Indian ports so far this month, said a custom official, who also declined to be identified as he was not allowed to speak to media.
India on an average bought 250,000 tons of sunflower oil every month in the last marketing year, mostly from Black Sea region.
The industry will need time to refine and distribute the 500,000 tons of sunflower oil imported in June, which will reduce imports in July, the Hyderabad based buyer said.
In January 2023, India had imported a record 461,458 tons of sunflower oil.
India buys palm oil mainly from Indonesia, Malaysia and Thailand, while it imports soyoil from Argentina, Brazil, and United States.