Supply Chain Disruptions: Sunflower Oil Sales Plunge Amid Middle East Conflict

India's refined sunflower oil market is facing a significant challenge, with sales predicted to drop by 10% this fiscal year. The primary causes are supply chain disruptions resulting from the ongoing Middle East conflict and increased prices driving consumers to cheaper alternatives.

Crisil Ratings has highlighted that despite the expected decline in volume, revenues might remain stable as higher realisations offset the drop. However, refiners are dealing with tighter inventory levels due to increased logistics costs and geopolitical tensions that affect import routes from Ukraine and Russia.

The situation is further compounded by weakening currency and increased shipping costs, leading to higher retail prices. This has prompted a potential consumer shift towards more affordable options like rice bran and soybean oil.