India Imports 60% of Its Edible Oil Needs as Global Tensions Reshape Trade Flows

27 April 2026, New Delhi: India’s edible oil sector is entering a crucial phase where climate disruptions, geopolitical tensions and energy market movements are converging, leading imports to move from price-led buying toward supply-driven sourcing, according to Bhavna Shah, Vice President of Indian Vegetable Oil Producers’ Association (IVPA).

Speaking at the 24th International Conference BLACK SEA GRAIN.KYIV-2026, Shah said three major factors are likely to shape the 2026-27 outlook: weak monsoons, elevated crude oil prices and strong global biofuel demand, all of which could tighten edible oil availability. She noted that the broader market sentiment remains slightly bullish, while India is expected to stay stable through efficient supply chains, timely imports and policy action when required.

She said edible oil inflation could edge higher due to a weak monsoon, volatility in crude oil markets, fertiliser shortages, gas-linked production constraints and biofuel mandates that are tightening global palm oil supplies. At the same time, India’s capacity to absorb global surpluses is expected to provide some cushion to the market.

According to Shah, India continues to be a major destination for surplus edible oils available in global markets, with buyers looking to the country whenever excess supply emerges in any region.

She also said the edible oil economy should not be viewed only through demand and supply trends, but through the broader relationship between food, feed and fuel. With stronger biofuel linkages, edible oils are no longer limited to food use, as rallies in fuel prices can quickly influence global edible oil prices through feedstock diversion.

She added that policy decisions and market assessments now need to account for food security, feed demand and fuel consumption together, as the connection between these sectors is increasingly shaping price volatility and trade flows.

India’s edible oil imports have remained in the range of 15 to 17 million metric tonnes. Imports in March 2026 rose 11 percent year-on-year to 1.19 million tonnes, although the two-month average declined 12 percent due to higher prices.

For the 2025-26 oil year, imports are projected at 16.5 million tonnes, while domestic production is estimated at 9.6 million tonnes.

On the import mix, Shah said sunflower oil is expected to maintain resilient demand. She noted that supply disruptions, particularly in Argentina, may delay soybean oil shipments, while palm oil shipments remain strong because of favourable price spreads.

She said palm oil is likely to dominate the import basket for now because of its cost advantage. However, after April 2026, soybean oil and palm oil are expected to compete more actively for India’s market share, with soybean oil from China emerging as a notable factor.

India depends on imports for around 60 percent of its edible oil consumption, making it one of the world’s largest edible oil importers. Shah said the country remains the largest structural demand hub, continuing to influence global trade flows even as consumption stays ahead of domestic production.

She added that medium-term supply tightness remains in place despite strategic efforts under government programmes such as the National Mission on Oil Palm, the National Mission on Oilseeds, MSP enhancement and the broader self-reliance push.

Under oil palm and oilseed missions, the government is working toward greater scale and diversification in edible oil production, with combined commitments estimated at $2.5 billion.

Shah said future import patterns and price trends will increasingly depend on how policy support evolves amid ongoing geopolitical tensions. She added that the Government of India has responded decisively by calibrating policies, securing supplies, containing inflation and maintaining stability despite global disruptions.

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