- Bearish for Black Sea sunflower oil: India’s sunflower oil imports are forecast to drop 10% to 2.65 million tonnes in 2025/26, the lowest in four years, as buyers switch to cheaper palm oil.
- Bullish for palm oil: A wide price discount of over $333/t versus sunflower oil is driving a strong substitution effect, with January palm oil imports up 51% month-on-month.
- Increased competition: Argentina is undercutting Black Sea sunflower oil by $10–20/t, intensifying pricing pressure in the Indian market.
India’s Sunflower Oil Imports Slide to Four-Year Low
India’s sunflower oil imports in the marketing year ending October 2026 are projected at 2.65 million tonnes, down from 2.94 million tonnes a year earlier. The 10% decline takes volumes to their lowest level since 2021/22, signalling a structural shift in India’s vegetable oil import mix toward palm oil.
Price Differentials Driving Substitution
The key driver behind the shift is the widening price premium of sunflower oil over palm oil. As of 5 February 2026, sunflower oil CIF Mumbai for February delivery was assessed at $1,412.90/t, unchanged day-on-day and sitting at the week’s high. In contrast, palm oil FOB Malaysia traded at $1,079.58/t, down $4.97/t from 4 February and marking the week’s low. This leaves a price gap of more than $333/t in favour of palm oil, incentivising refiners and buyers to substitute away from higher-priced sunflower oil wherever possible.
| Item | Metric | Value |
|---|---|---|
| Sunflower oil imports 2024/25 | Volume | 2.94 million tonnes |
| Sunflower oil imports 2025/26 (forecast) | Volume | 2.65 million tonnes |
| Import change | Year-on-year | −0.29 million tonnes (−10%) |
| Sunflower oil CIF Mumbai (Feb delivery, 5 Feb 2026) | Price | $1,412.90/t (week high) |
| Palm oil FOB Malaysia (5 Feb 2026) | Price | $1,079.58/t (week low) |
| Daily change in palm oil price (5 Feb vs 4 Feb) | Price move | −$4.97/t |
| Sunflower vs palm oil price spread | Differential | >$333/t |
| India’s core sunflower oil demand | Monthly volume | 200,000–225,000 tonnes |
| Palm oil imports (January vs December) | Month-on-month | +51% |
| Sunflower oil imports (January vs December) | Month-on-month | −23% |
| Argentina sunflower oil vs Black Sea | Price discount | $10–20/t lower |
Import Trends and Core Demand
According to Aashish Acharya, vice president at Patanjali Foods Ltd, India is expected to import only enough sunflower oil to meet a core demand base of roughly 200,000–225,000 tonnes per month. This restrained buying strategy reflects the strong economics of switching to palm oil and confirms that upside in sunflower oil imports is likely capped as long as the current price premium persists.
The substitution pattern was already evident in January trade flows: palm oil imports surged 51% versus December, while sunflower oil imports fell 23% over the same period. The data underscore a decisive pivot by Indian buyers to maximise lower-cost palm oil and minimise exposure to higher-priced sunflower oil.
Competitive Pressure on Black Sea Exporters
The shift in India’s buying behaviour is bearish for Black Sea sunflower oil exporters, who have relied heavily on the Indian market. The widening sunflower–palm spread undermines Black Sea competitiveness and will likely force suppliers to concede on price or lose market share. Additional pressure stems from Argentina, which is offering sunflower oil at $10–20/t below Black Sea origins on the back of increased production, further crowding the market.
While Indian demand for vegetable oils overall remains robust, the composition is tilting toward palm oil, a trend that could lend support to Malaysian palm oil futures through year-end. Conversely, Black Sea sunflower oil pricing structures face downside risk as exporters compete for limited demand with more aggressive offers.
Source: Market Data
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