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NEW DELHI : Prices of most cooking oils rose in February in India amid the Russia-Ukraine conflict, with branded sunflower, vanaspati, mustard, and groundnut oil prices witnessing month-on-month increase, according to data from retail intelligence platform Bizom.
Ukraine and Russia are among the key suppliers sunflower oil, fulfilling a significant chunk of global demand for the edible oil.
India consumes an estimated 2.5-3 million tonnes of sunflower oil per annum. Nearly 70% of this comes from Ukraine. Ukraine and Russia together accounted for nearly 13% of all of India’s edible oil imports in 2021, supplying 1.6 million tonnes, according to a report by Reuters.
In India, prices of packaged sunflower oil rose 4% sequentially in February, while those mustard oil moved up 8.7%. Soybean oil prices fell a marginal 0.4%, while vanaspati rose 2.7%. Groundnut oil was up 1%. Palm oil, that is widely consumed in Indian households, saw prices drop 12.9% after a period of high prices. Compared to February 2020 though, palm oil prices are still up 22.9%.
Bizom tracks sales of packaged consumer goods across 7.5 million retail outlets in India.
Edible oil prices in India had seen some correction between the September and December quarter. In January, Bizom data indicated a 10-30% easing of prices from the peak of the last two years.
However, the conflict in Ukraine late February put fresh pressure pressure on essential commodities, including cooking oil.
Akshay D’Souza, chief marketing officer at Bizom, said while edible oil prices had seen some stability over the last two quarters driven by curbs imposed by the government, the Russia-Ukraine war led to the reversal of that trend.
"Sunflower oil, which is a key import from Ukraine, has seen prices move up immediately. More price stress may be on the horizon as the war extends and sanctions get imposed on Russia," said D’Souza.
Bizom is yet to release data for March.
Edible oil price have increased 15-20% year-on-year, Kunal Vora, Head of India Equity Research at BNP Paribas India said in an India Consumer Price Tracker report released on 17 March. “In our recent checks, we heard that the prices were set to increase again because of a recent increase in edible oil prices," Vora said. Prices of most edible oils are still higher pre-covid levels. Compared to pre-covid period or February 2020, for instance, price of sunflower oil is up 50%; vanaspati oil is up 58% while soyabean oil is up nearly 20%.
Marico declined to comment on a query on its edible oil brand Saffola.
A company spokesperson from Mother Dairy said with the situation in the domestic edible oil industry being dynamic, various edible oils are being traded at a higher price point. This has impacted consumer demand,. However, it anticipates supply of mustard, palm and soyabean oil to improve. The dairy cooperative sells groundnut, mustard and sunflower cooking oils under the Dhara brand.
"This upward movement is mainly due to the fact that consumers of sunflower oil have started shifting to other types of oils such as groundnut, rice-bran, soyabean, etc. Now, with supplies of oils such as mustard, soyabean and palm improving, the prices of different types of oils, except sunflower oil, have started experiencing a downtrend. Hence, we expect that the consumer prices may likely come down in the days to come," the spokesperson added.
