Sunflower oil price up $400-450 owing to Ukraine war; dependence on imports to remain: Ruchi Soya

"India consumes roughly about 200,000 tonne of sunflower oil every month. But this standoff between Russia and Ukraine has resulted in the supplies definitely getting disrupted. But we are lucky in the sense that as far as February and March is concerned, the imports have been reasonable, but come April, we will start feeling the pinch. The core demand which cannot be replaced with any other oil, as far as sunflower is concerned, is about 100,000 tonne a month," Chaturvedi said.

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"Overall, I think India has managed the situation quite well and we do not anticipate too much of a hiccup. The other thing is that some sunflower oil is actually moving out of two Russian ports. Though, the quantum is limited, that will take care of the core demand," he added.

Asthana estimated India’s sunflower oil consumption at 2-2.5 million tonne per annum. He said that sunflower oil demand is regionally inelastic, adding that prices of sunflower oil have risen by USD 400-450 due to the Ukraine crisis. Ruchi Soya has been able to pass on some of the price hike to its consumers, he mentioned.

"Sunflower oil’s importance in India's overall edible oil complex is very critical. We do about 2-2.5 million tonne a year. So that is one part. The prices have nearly gone 2.5 times but that's over two year. If I were to compare the one year part, the prices are up nearly 60 percent. And if I were to look at one month, there is something what I describe as a war premium right now on Sunflower oil, which has jumped up by nearly by USD 400-450, which is clearly unsustainable, because supply is limited and the demand is consistently there, which is causing a big trouble. Sunflower oil is reasonably inelastic demand. So they will not instantly switch over. So I don’t expect demand to go down but this would have some impact for sure in the price and the overall sort of consumption of sort," Asthana said.

On shortage, he said that 50 percent of the planting in Ukraine may not happen because of the war. Additionally, he expects 60-65 percent dependence on imports for oil to remain, going ahead.

"The fact is that our 60 to 65 percent dependence on imports will consistently remain. So we have to watch out. It's not that straightforward yet, probably next month, or month and a half, we will know better as to the spring planting - so the most critical part I'll watch out for is that how the spring planting, which happens in April and May in Russia and Ukraine, plays out with the warfront raging right now. So Ukraine, there's an expectation that nearly 50 percent planting may not be done," Asthana mentioned.