InfoSAWIT, NEW DELHI – India, the world’s largest vegetable oil importer, has begun reducing import volumes amid rising prices and energy supply disruptions triggered by the prolonged conflict in Iran.
The ongoing conflict in the Middle East over the past month has disrupted global energy supply chains, leading to fuel shortages in several Asian countries, including India. One of the most significant impacts is the scarcity of LPG, which has disrupted operations in the food and beverage industry.
Many culinary businesses in major cities such as New Delhi, Mumbai, and Bangalore have been forced to scale down operations or switch to alternative fuels such as kerosene and firewood.
Vice President of Patanjali Foods Ltd., Aashish Acharya, revealed that around 40% of India’s vegetable oil consumption comes from the hotel, restaurant, and catering (HORECA) sector.
“India’s vegetable oil demand is expected to decline by around 250,000 to 300,000 tons per month, and could continue falling if the conflict persists and commercial LPG supply remains limited,” he said, as reported by InfoSAWIT from Bloomberg, Friday (April 3, 2026).
He also highlighted the strong link between global geopolitical dynamics and domestic consumption patterns.
“This situation shows how geopolitical events can directly impact local markets and consumer behavior,” he added.
Rising prices have worsened the situation, with domestic vegetable oil prices increasing by up to 17% over the past month due to currency depreciation, higher logistics costs, and increased freight rates.
Meanwhile, import costs have surged by around 25%, according to President of Emami Agrotech Ltd., Mayur Toshniwal, prompting market players to hold back purchases.
“Demand will decline at these high price levels,” he stated.
Data shows that India’s vegetable oil imports in March are estimated to fall to around 1.2 million tons, compared to 1.32 million tons in the previous month. Executive Director of the Solvent Extractors’ Association of India, B.V. Mehta, noted that urban consumption will remain under pressure as long as the LPG crisis persists.
Consumer behavior is also shifting, with more households cooking at home. Consumption of soybean, sunflower, and rapeseed oil has increased at the household level, although overall purchases remain limited due to high prices.
“Demand is now on a day-to-day basis as buyers are reluctant to stock up at current price levels,” Toshniwal added.
The decline in demand from India could put pressure on major vegetable oil exporting countries, including Indonesia and Malaysia, particularly in maintaining global market stability amid ongoing uncertainty. (T2)
