After a brief lull, edible oil prices are shooting up yet again. Malaysian palm oil futures climbed to their all-time high on February 23 as tensions between Ukraine and Russia escalated. A war between the two nations, the top producers and exporters of sunflower oil, will create a supply crunch in the market, leading to even higher prices. India will be hit harder than others as 90 percent of the country’s sunflower oil imports are from Russia and Ukraine.
“The commodity market is on fire. Just today, palm oil prices climbed by $40,” B V Mehta, executive director of Solvent Extractor’s Association of India, told Moneycontrol on Wednesday.
Edible oil prices have been climbing unabated globally and in India since the onset of the pandemic. The climb has been so steep that the Indian government had to take several measures to rein in the increase in prices.
The government interventions taken so far, however, are not going to be enough as the supply of edible oils such as palm oil and sunflower oil is interrupted again. Read on to find out what triggered the rise in oil prices in 2021, how government measures helped check the climb, why they are set to rise yet again, and how it will impact the FMCG industry and end consumers.