Increase in edible oil prices challenges household budgets
AHMEDABAD: Edible oil prices have surged, straining household budgets and dampening market demand. Cottonseed oil now costs Rs 975 per 10 kg, up from Rs 930, while soybean and rice bran oils have seen similar increases. Global factors, including disruptions from the Russia-Ukraine conflict, worker protests in Argentina, and Brazilian floods, are to blame. Despite the hikes, experts like Priyam Patel predict price stabilization as conditions improve and government measures support the agricultural sector.
AHMEDABAD: The edible oil market has been hit by a surge in prices, leaving household budgets strained and market demand sluggish. Sources attribute the price hikes to several global factors, resulting in increases of Rs 50 to Rs 70 per 10kg in most edible oils.
Cottonseed oil now costs Rs 975 per 10kg, up from Rs 930 three months ago. Similarly, soybean oil has risen to Rs 970 from Rs 910 per 10 kg, and rice bran oil now stands at Rs 950, up from Rs 890 per 10 kg.
The limited supply of sunflower oil from Russia and Ukraine, due to off-season production and high temperatures affecting crops, has contributed significantly to the price rise.
The ongoing Russia-Ukraine conflict, with Ukraine being a major producer of sunflower oil, has exacerbated the situation.
“Global factors are significantly impacting edible oil prices. Loose oil prices have fluctuated due to these global influences, and domestic demand remains relatively low. Groundnut oil prices are hovering around Rs 2,750 to Rs 2,800 per 15 kg,” said Pratap Chandan, chairman of the Federation of Gujarat Edible Oil Traders.
Additional disruptions include workers’ protests in Argentina and floods in Brazil, which have severely impacted soybean oil supplies. Reduced soybean crushing and lower shipments from Argentina via Brazil have tightened supply, leading to price increases.
The Israel-Palestine conflict has further disrupted supply chains.
Despite the current price hikes, experts anticipate stabilization.
“Stabilization is expected as market conditions adjust, and geopolitical tensions potentially ease. A resolution of conflicts could improve supply chain stability and decrease prices. Increased production in upcoming harvest seasons is anticipated to boost supply, helping to stabilize prices. Govt measures to manage inflation and support the agricultural sector may also contribute to market stabilization,” said Priyam Patel, MD of an edible oil manufacturing company.
