Article - Russia overtakes Ukraine as India's top sunflower oil supplier
That's correct; Russia has become India's primary supplier of sunflower oil, displacing Ukraine.
Here are the full details:
Key Shift in Market Share
Russia's Dominance: Russia has rapidly escalated its exports to India. Its share in India's total sunflower oil imports has surged significantly.
For instance, in the first half of a recent year (January to July), Russia's sunflower oil supply to India was valued at $815 million, making it the number one supplier. Ukraine's Position: Ukraine, which was traditionally India's largest supplier before the war, fell to the second position, with a supply value of around $374 million in the same period. Argentina typically ranks as the third-largest supplier.
Primary Reasons for the Shift
War and Supply Chain Disruption from Ukraine:
Port Blockade: The conflict and the Russian blockade of key seaports on the Black Sea have severely restricted Ukraine's primary export route.
Before the war, nearly 90% of Ukraine's agricultural produce was exported through seaports. Higher Transport Costs: To ship to India, Ukraine has been forced to rely on slower and more expensive road and rail routes through Europe.
This significantly increases the final cost of Ukrainian sunflower oil for Indian importers. Redirection to Europe: Much of Ukraine's available sunflower oil has been diverted to neighboring European countries, which is logistically easier and less costly than shipping to India.
Reliability and Competitive Pricing from Russia:
Assured Supply: Industry insiders in India cite Russia's easier and assured access to seaports as a critical factor, making it a more dependable supplier amidst global volatility.
Competitive Rates: Russia, which also had a large sunflower crop that it couldn't easily sell to Europe due to sanctions, was in a position to offer competitive rates to the price-sensitive Indian market.
Logistical Advantage: Russia is seen as a more reliable source for maintaining the supply chain.
India-Russia Trade Relations:
The overall strengthening of trade ties between India and Russia, particularly in commodities, has facilitated this increase. There has been a concerted effort from both Russian and Indian industry representatives to strengthen this supply chain.
India's Edible Oil Market Context
Import Dependence: India is one of the world's largest importers of edible oils, meeting nearly 60% of its total cooking oil requirement through imports.
Consumption Share: Sunflower oil is one of the three largest consumed edible oils in the country, after palm oil and soybean oil.
Less than 5% of the sunflower oil consumed in India is produced locally. Duty-Free Imports: The Indian government has previously offered measures, like reduced or zero import duties on crude sunflower oil, to help keep domestic cooking oil prices stable, which further encourages imports from competitive sources like Russia.
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