India-bound sunflower oil cargoes face cancellation, delays as war disrupts Russian shipments

MUMBAI: A 20,000-ton shipment of Russian sunflower oil intended for India was cancelled due to damage to port infrastructure in the Black Sea region, according to Sandeep Bajoria, president of the International Sunflower Oil Association. This is the first washout in the sunflower oil trade in many years. The Russia-Ukraine conflict has also delayed approximately 60,000 tons of sunflower oil destined for India, leading Indian buyers to increase palm oil purchases ahead of the festival season.

Russian exporters are now attempting to transport sunflower oil from Baltic Sea ports like St Petersburg and Ust-Luga, as shipments from the Black Sea have become increasingly difficult. This shift to Baltic ports comes with higher freight costs and an additional 10-day voyage time, though it is the only viable alternative due to the deteriorating Black Sea infrastructure caused by the war.

India, which meets nearly all of its sunflower oil demand through imports, needs around 250,000 tons of imports per month. However, October shipments may decrease to 160,000 tons due to loading delays in Russia and Ukraine. With sunflower oil stocks already depleted due to below-average imports in recent months and demand for edible oils expected to rise during the upcoming festival season, India is increasingly turning to palm oil.

Russia has intensified sunflower oil exports to China as the disruption in India's supply chain continues. In a three-day period this week, India purchased 150,000 tons of crude palm oil for November and December shipments to both the east and west coasts. This surge in palm oil purchases by India could help deplete stocks in top producers, Indonesia and Malaysia, thereby supporting Malaysian palm oil futures.