New Delhi, March 13 (TIWN) Shortage of sunflower oil amid the ongoing Russia-Ukraine war has sent crude palm oil prices through the roof.

India is a major importer of crude palm oil, as the country meets more than two-third of its edible oil needs through imports, of which palm oil accounts for more than 60 per cent.

India imports more than 2.5 million tonnes of sunflower oil, including from Russia and Ukraine.

In reaction to possible supply disruption of sunflower oil, palm oil prices rallied sharply as all the edible oils track each other’s prices as they compete in the market for price realisation, and any potential supply disruption for one variant buoys the prices of others.

“The war between Ukraine and Russia shook the major supply of sunflower oil, thereby disrupting the demand and supply of the entire global edible oil (market). India is one of the largest importers of sunflower oil, importing more than 2.5 million tonnes. Dependence on sunflower oil from other large producers like Europe and Argentina seems to be very low as both these countries are largest domestic consumers,” said Vinod T.P., Research Analyst at Geojit Financial Services.

“With regard to Argentina, due to higher prices, lower output and higher shipment cost, the move for importing sunflower oil fromm there is likely to be on the lower side. As India is diverse in culture and eating habits, people will mostly switch over to other edible oils which are available at a cheaper rate.”

Vinod expects the dependence on soybean oil and palm oil to rise.