The Multi Commodity Exchange of India (MCX) has introduced futures contracts on Crude Sunflower Oil, expanding exchange-traded risk-management avenues for participants across India's edible oil value chain.
India consumes an estimated 26-27 million tonnes of edible oil annually, with more than 60% of its requirement met through imports. The import dependence exposes the domestic market to global price movements, international supply-demand dynamics, currency fluctuations and changes in competing edible oil prices.
Sunflower oil accounts for around 9% of India's edible oil consumption, with annual crude sunflower oil consumption estimated at around 3 million tonnes. Nearly 2.8 million tonnes of this requirement is met through imports, making the segment particularly sensitive to international price movements and global supply conditions.
The pricing of edible oils is closely interconnected, influencing substitution patterns and the relative competitiveness of sunflower oil. MCX said the new contract will provide market participants with a transparent and exchange-traded mechanism to manage price exposure across the edible oil complex.
The contract is designed for importers, refiners, processors, traders and other participants across the value chain to manage exposure to price volatility and improve risk-management efficiency.
Commenting on the launch, Praveena Rai, MD & CEO of MCX, said the Crude Sunflower Oil futures contract will provide market participants with a transparent and efficient mechanism to manage price exposure while supporting the development of the domestic edible oil market.
The contract will be cash-settled, with prices quoted on an Ex-Tank JNPT basis, excluding applicable sales tax and GST.
MCX, operational since 2003, is India's leading commodity derivatives exchange. It had a market share of more than 98.5% by value of commodity futures contracts traded in Q1 FY27, according to the exchange. Its product portfolio spans bullion, energy, metals, agricultural commodities and sectoral commodity indices.
According to the National Statistics Bureau of Kazakhstan, in 2026, the area under oilseed crops in the country increased by 30% compared to the previous year to 5.179 million hectares due to the policy of diversifying sown areas and strengthening the role of oilseed crops in the structure of agricultural production.
The area under sunflower, the main oilseed crop in the country, increased the most - by almost 25% to a record 2.202 million hectares, which is 2.3 times higher than in 2021 due to a stable increase over the past 5 years.
In addition, local farmers have increased the area sown with other oilseed crops - rapeseed, flax, cotton, and safflower.
The National Association of Oilseed Processors explains this increase in area by the growth in demand for raw materials from their own processing enterprises, as well as by the increase in exports of oil and fat products, which were supplied to 23 countries around the world this season.
The available industrial capacities allow Kazakhstan to process over 5.2 million tons of oilseeds per year, of which 4.4 million tons are sunflower. Over the next two years, the country plans to implement large-scale investment projects to build new oil refineries with a total capacity of over 3 million tons of oilseeds per year.
The main buyers of Kazakh sunflower oil are Central Asian countries and China, where it competes with Ukrainian and Russian oil. And thanks to the suspension of supplies through the Black Sea ports, Kazakhstan can maximize the influence of Russian oil suppliers on the Chinese market.
During 2021-2026, Ukraine reduced its exports of sunflower oil to China from record figures and the status of one of the main suppliers to several percent in the overall import structure.
China used to be the second largest importer of Ukrainian sunflower oil after India, purchasing over 1 million tons of oil per year. Ukraine used to supply half of China's sunflower oil imports, but in recent years it has sharply reduced its supplies in this direction.
Russia is losing its price advantage over Ukraine in the global sunflower oil market as disruptions to sea logistics drive up the cost of Russian exports. Analysts note that Russian sunflower oil, which previously competed internationally at lower prices, is now being offered at prices above those in Ukraine for the first time in a long time.
The reduction in Black Sea oil supplies to global markets and rising logistics risks have weakened one of Russia’s key competitive advantages.
Last week, Ukrainian sunflower oil for August delivery was offered at $1,380-$1,400 per ton, while Russian oil was mostly offered at $1,400-$1,410 per ton.
However, if problems with sea logistics continue into the fall, the biggest negative impact may be felt not by global buyers, but by sunflower producers in both Ukraine and Russia.
Ukraine is expected to harvest about 13.4 million tons of sunflower this year, the highest figure in the last three years. If sea exports do not resume before the new crop arrives in large volumes, the domestic market could face a surplus of raw materials amid limited opportunities to sell oil abroad.
In that scenario, processors are likely to limit purchases or reduce procurement prices.
The first signs are already visible. In July and early August, sunflower prices in Ukraine fell by ₴3,000-₴5,000 ($73-$121) per ton, while demand prices for the new season’s crop were about ₴10,000 ($242) per ton below actual working purchase prices.
A similar situation may develop in Russia, where a record sunflower harvest of more than 20 million tons is expected.
However, analysts note that Ukraine already has experience in redirecting exports to alternative routes, while Russian companies are only beginning to seek new logistics solutions.
Under favorable conditions, Ukraine could potentially export 350,000-500,000 tons of sunflower oil per month through Danube ports, rail and road routes.
A sharp rise in crude oil prices and reduced sunflower oil supplies from the Black Sea region are supporting global vegetable oil prices. October Brent futures have gained 12.7% over the past week to $89 per barrel, improving the outlook for biofuel feedstock demand. At the same time, the market expects a seasonal increase in rapeseed and sunflower oil supplies from Ukraine and Russia, which could limit further price gains.
The decline in Black Sea supplies is providing particularly strong support to sunflower oil prices in India. Bid prices rose by another $15/t over the week to $1,485–1,490/t CIF Mumbai. In Ukraine, sunflower oil for August delivery to Danube ports is quoted at $1,320–1,335/t, although supply remains minimal as most plants have halted sunflower seed crushing. Meanwhile, Russian sunflower oil for September delivery fell by $50–60/t to $1,310–1,320/t FOB amid expectations of new-crop supplies and higher freight costs.
Ukrainian crushers are increasingly switching to rapeseed, with low domestic prices providing attractive crushing margins. Higher production is already putting pressure on rapeseed oil prices, which have declined to €1,000–1,020/t FCA plant and €1,040–1,050/t loaded into European-gauge railcars at Ukraine’s western border. Prices delivered to Germany remain at €1,170–1,200/t, while road transportation costs for vegetable oil from Ukraine to the EU have risen from around €100/t to €170–200/t within several weeks.
Price trends in other vegetable oil markets remain mixed. December soybean oil futures in Chicago gained 0.9% over the week to $1,500/t, although they remain 4.3% lower over the past month amid improved weather and expectations of a larger US soybean crop. Malaysian palm oil rose 1.1% over seven days to 4,748 ringgit/t ($1,160/t), supported by stronger Indian imports, while further growth in Malaysian production and stocks continues to limit price gains.
Pressure on the global vegetable oil market could intensify in September-October. Seasonal supplies of cheaper sunflower and rapeseed oil from the Black Sea region are expected to increase, while the US is set to boost soybean oil availability and Canada will add more rapeseed oil to the market. Combined, these factors could outweigh support from high crude oil prices and limit prices across the major vegetable oil markets.
Finnish renewable fuels producer Neste has reported record results for the second quarter of 2026.
The company’s renewable products segment reached all-time high earnings before interest, taxes, depreciation and amortisation (EBITA), supported by a record high sales margin and sales volumes exceeding 1M tonnes, Neste said on 24 July when presenting its results for the January-June period.
“The conflict in the Middle East dominated global oil and product markets through most of the period, creating an exceptional market environment for Neste,” said Heikki Malinen, president and CEO of Neste.
“At the same time, we benefited from favourable regulatory decisions that will continue to support demand for renewables for years to come. We successfully captured the market potential to deliver strong margins, leading to robust financial results, despite production limitations in renewable products.”
The renewable products segment reported comparable EBITDA of €859M (US$993M), up from €174M (US$201M) during the second quarter of the previous year and sales margins reached a record-high level of US$1,223/tonne, up from US$361/tonne, Malinen added.
The improved EBITDA and increased sales margin were due to stronger premiums in both the US and European markets, Neste said.
According to Neste, the renewable products segment also benefitted from the surge in fossil fuel prices due to the conflict in the Middle East.
“The ongoing Middle East conflict has accelerated global energy debate: repeated supply shocks keep energy security high on the policy agenda,” Malinen said.
“In this context, reducing reliance on imported fossil fuels is an increasingly important strategic goal both to strengthen energy security of supply and to mitigate climate change. Renewable fuels have a vital role to play here.”
Production volumes during the second quarter were impacted by a delay in replacing equipment in Neste’s Singapore production facility. Neste’s own renewables production facilities operated at an average utilisation rate of 75% during the three-month period, down from 81% during the same quarter of 2025.
During the second quarter, Neste produced 1.126M tonnes of renewable fuel, including 977,000 tonnes of renewable diesel, 126,000 tonnes of sustainable aviation fuel (SAF), and 23,000 tonnes of other products. Production during the same period the previous year totalled 1.16M tonnes, including...
Russian vegetable oil producers are being forced to seek alternative export routes following the shutdown of EFKO’s terminal in Taman. Exporters are now primarily looking to Baltic ports, as ports around St. Petersburg have experience handling liquid bulk cargoes. However, their handling capacity remains limited.
The disruption is significant for Russia’s vegetable oil exports, as more than 50% of the country’s shipments previously moved through ports in the Azov and Black Sea regions. The situation worsened after EFKO’s vegetable oil terminal in Taman suspended operations following a drone attack on the night of July 30.
Alternative routes under consideration include shipments across the Caspian Sea and through Iran, which could help maintain supplies to India and other Asian markets. However, this route requires the oil to be transshipped three times, substantially increasing logistics costs. Another option is to expand shipments in flexitanks, which currently account for around 10% of Russian exports.
Exporters are also considering transporting oilseeds and processed oilseed products by road to ports in the Gulf of Oman. This option is being explored primarily to fulfil existing contractual obligations to buyers in the Middle East.
Redirecting exports to the Baltic significantly lengthens transport routes and raises costs for Russian suppliers. Deliveries from central and southern regions to Baltic ports can take one to two weeks, while the ports themselves have limited capacity for handling vegetable oils. As a result, fully replacing traditional export routes through the Azov and Black Sea regions will be difficult in the short term.
Drought impacts on European crops summary
- European drought conditions are reducing yields across major crops
- Corn faces the steepest losses with harvests projected at lowest for decades
- Wheat, barley and oilseeds have suffered smaller yield declines
- Imports from Ukraine and overseas suppliers could ease shortages
- More frequent droughts may make future water supplies less reliable
Edible oil shipments to India increased by 34% in July – to a 10-month high of 1.49M tonnes – compared to the previous month, Knowledge and News Network (KNN) wrote.
The increase was due to a rise in purchases of palm and soyabean oil by refiners to replenish stocks ahead of the upcoming festival season, the 4 August report said.
According to estimates by industry dealers, palm oil imports jumped by 50% from June to 733,000 tonnes in July, marking a five-month high.
Soyabean oil imports increased by 32% to 501,000 tonnes, the highest level in seven months, while sunflower oil shipments rose 4% to 253,000 tonnes.
The increase in imports came amid declining domestic stocks following lower purchases in recent months, the report said.
At the time of the report, refiners were rebuilding inventories ahead of the festival season, when edible oil consumption typically increased.
Sandeep Bajoria, CEO of Mumbai-based vegetable oil brokerage Sunvin Group, said refiners were replenishing stocks to meet the expected seasonal demand.
Rajesh Patel, managing partner at Rajkot-based GGN Research, said soyabean oil imports could exceed 500,000 tonnes in August and September, supported by competitive international prices.
According to Patel, higher import demand was due to lower domestic rapeseed and soyabean crushing of rapeseed.
India primarily imports palm oil from Indonesia and Malaysia, while soyabean and sunflower oil are sourced mainly from Argentina, Brazil, Russia and Ukraine, according to the KNN report.
The import estimates excluded duty-free edible oil shipments entering India by land from neighbouring Nepal and the Solvent Extractors’ Association (SEA) of India was expected to release official July import data by mid-August.
Increased Indian purchases could support global edible oil markets by helping major producers such as Indonesia, Malaysia and Argentina reduce stocks, potentially supporting benchmark palm oil and soyabean oil futures, the report said.