Russia is increasing sunflower oil exports to China against the background of supply problems to India

In the new marketing year, supplies of Russian sunflower oil to China are expected to double, reaching 1 million metric units. As reported by Kirill Tyshkevich, head of trading at the Sodrugestvo group (one of the top three Russian producers), exports are carried out overland and at discounted prices.

The reason for the redirection of trade flows is problems with shipping products via the Black Sea, where loading of grain and vegetable oils has been disrupted due to attacks on port infrastructure. Because of these logistical difficulties, shipments by sea to the key buyer — India — will decrease this year to 1.1 million tonnes (last year the figure was 1.5 million tonnes).

Sunflower production in Russia this year is projected to increase to 20 million tonnes compared to 17.5 million tonnes the previous year. Nevertheless, due to weak export demand, processing volumes will decrease, and by the beginning of the next marketing year, the country will retain carryover seed stocks amounting to 3 million tonnes.

Similar supply difficulties to India are being faced by Ukraine, which ranks second in the world in sunflower oil supplies. According to a representative of a Ukrainian exporter whose terminal in the Odessa region was damaged by strikes, local plants typically processed about 600 thousand tonnes of seed monthly between October and March, but processing will now be cut in half due to problems with exporting finished products.

On the global market, sunflower oil, the bulk of which is produced in the Black Sea region, competes with palm oil from Indonesia and Malaysia, as well as soybean oil from South America.