(Bloomberg) -- Russia started shipping sunflower oil to India, increasing competition for top producer Ukraine in the world’s biggest import market.
Efko Group sent 16,000 metric tons to an Indian refiner in January, Rostislav Kovalevsky, deputy director of the Voronezh-based producer’s export unit, said in an interview in Moscow. Efko expects shipments to grow, taking share from Ukraine, which supplied 88 percent of India’s imports in the 2015-16 season.
India bought about 1.52 million tons of sunflower oil in the season ended in October, according to data compiled by the Solvent Extractors’ Association of India. Russia, the world’s second-biggest exporter, is seeking new markets after Turkey placed curbs on some Russian food items in March.
“Efforts to come to India’s market had been made for many, many years,” Kovalevsky said. “We are now negotiating to sell a second shipload.” He declined to name the buyer.
The purchaser agreed to buy Russian oil after it met a so-called bleachability test, allowing refiners to remove enough color from the crude product, Kovalevsky said. Efko upgraded three plants to meet the requirement, he said. The company plans sales of 200,000 tons to India each season within a few years and offered a discount to Ukrainian prices, Kovalevsky said.
Consumption of edible oils in India is rising as the population expands and incomes increase, according to the U.S. Department of Agriculture. The Asian country depends on imports for 70 percent of demand, according to the Solvent Extractors’ Association. Indian purchases of sunflower oil held steady last season, while imports of soybean oil increased on large world supplies, it said.