Russia steps up sunflower oil exports to China as war disrupts India trade

By Rajendra Jadhav

MUMBAI, Oct 1 (Reuters) - Russia's sunflower oil exports to China are set to double in the new marketing year, but at discounted prices, a leading Russian exporter said on Thursday, as war has damaged the country's port infrastructure and disrupted shipments to top buyer India.

The world's biggest producer and exporter of sunflower seeds has struggled to ship sunflower oil from its Black Sea ports because of infrastructure bottlenecks, even as demand from India remains strong, said Kyrylo Tyshkevych, head of trading at Sodrugestvo Group, one of Russia's top three producers.

Russian and Ukrainian attacks on ports in the Black Sea region in recent weeks have disrupted loading operations at ports used to ship grains and vegetable oils.

Russian exporters are offering sunflower oil to China via land routes, at a discount, with purchases expected to double to 1 million metric tons in the marketing year that began September 1, Tyshkevych said on the sidelines of the Globoil conference in Mumbai.

Shipments to India, which go by sea, are expected to decline to 1.1 million tons this year, from 1.5 million tons a year earlier, he said.

Russia's sunflower seed production is expected to rise to 20 million tons this year from 17.5 million tons last year, he said.

But weak export demand is expected to curb crushing, leaving the country with carryover stocks of 3 million tons of seeds at the start of the next marketing year, he said.

Like Russia, Ukraine, the world's second-largest sunflower oil supplier, has also been struggling to ship the oil to India, leading to lower sunflower seed crushing, said a Ukrainian sunflower oil exporter whose terminal in the Odesa region was damaged in Russian attacks.

Ukraine typically crushes around 600,000 tons of sunflower seeds each month between October and March, but crushing is expected to halve this year as mills face difficulties exporting sunflower oil, the exporter said. He declined to be named due to the ongoing conflict.

Sunflower oil, produced mainly in the Black Sea region, competes with palm oil from Indonesia and Malaysia and soyoil from South America.