Russian sunflower oil can take a leading position in the Chinese and Indian markets by 2024
18 Sep, 2020
Russian sunflower oil can take a leading position in the Chinese and Indian markets by 2024. This was stated by Deputy Minister of agriculture Sergey Levin at the strategic session "Export of Russian fat and oil products to India and China: a strategy for success" organized by the Federal center for export development of agricultural products of the Ministry of Agriculture of Russia ("AgroExport") together with Oil-and-Fat Union of Russia.Sergey Levin noted that the fat and oil industry is one of the leading segments of the Russian agricultural complex. It is also a leader in increasing production and exports. In 2019, the product volume in the total export revenue of the agro-industrial complex amounted more than 4 billion dollars (16%). Sunflower oil showed the best growth dynamic in 2020 with exports 30% higher compared to the same period last year. This was achieved due to a significant increase in supplies to China (by 2.5 times) and India (by 4.5 times), the Deputy Minister noted.
"Personal income in China and India are growing steadily. Therefore, there is a gradual transition from cheaper types of vegetable oils to sunflower ones in the consumer markets of the countries. Hopefully, in the coming years China will significantly increase the product imports, and India will increase purchases of sunflower oil even faster than China. So Russian producers have every opportunity to take a significant share of the Chinese and Indian sunflower oil markets by 2024," said Sergey Levin.
As the Deputy Minister noted, there is a need to implement several measures to realize this potential. This includes the raw material base increase, import substitution of foreign-selected oilseed hybrids or localization of hybridization in Russia. Production modernization and logistics infrastructure development are also needed. AgroExport developed a Concept promoting Russian fat and oil products in the Chinese and Indian markets to provide assistance to exporters and increase their competitiveness in the countries. The best international experience was taken into account while creating it, as well as the expert opinion of the industry community.
Currently, the Ministry of Agriculture of Russia is implementing measures aimed at improving the competitiveness of the industry. Among them are subsidies stimulating the oilseeds production and preferential lending at a rate of 1% to 5%. The measures also include compensation for the cost of agricultural products certification in foreign markets, amounting up to 90%.