Gas shortages cut sugar and edible oil demand in India

Consumption of sugar and edible oils in India is declining as a shortage of commercial gas cylinders forces restaurants and food outlets to scale back operations during the peak summer holiday season.

The shortage has hit roadside eateries and restaurants the hardest, particularly those relying on deep-fried foods. Industry representatives say this has already reduced edible oil consumption and impacted imports, which fell by around 9% month-on-month in March to 1.2 million tons.

The situation could curb imports of palm oil from Indonesia and Malaysia, as well as soybean and sunflower oil from Argentina, Brazil, Russia, and Ukraine, potentially affecting global markets.

Restaurant owners report significant operational challenges, with some forced to temporarily shut down or operate at reduced capacity due to delays in gas deliveries that can exceed three weeks, posing serious risks for small businesses.

India, the world’s second-largest importer of liquefied petroleum gas, is facing one of its worst gas crises in decades. The government is cutting supplies to industries to prioritize households, which is also weighing on sugar demand during a season that typically sees higher consumption due to holidays and weddings.

Tags: sugar, India, edible oils