Russia’s sunflower oil exports could fall by 40% after port attacks

Russia is facing growing difficulties exporting vegetable oils following drone attacks on port infrastructure in the Azov-Black Sea region. In particular, EFKO’s export terminal in Taman, with an annual handling capacity of 1.5 million tons, has suspended operations until damage assessments and repair work are completed. Around 60% of Russia’s vegetable oil exports are normally shipped through the Azov and Black Sea ports.

Despite these disruptions, Russia’s vegetable oil exports maintained positive momentum during January–July. According to OleoScope, total exports increased by 6% to 4.18 million tons. Sunflower oil exports rose 7% to 2.85 million tons, while rapeseed oil shipments also increased 7% to 925 thousand tons. In contrast, soybean oil exports declined by 11% to 361 thousand tons. India, Turkey and Iran remained the largest buyers of Russian sunflower oil.

Market participants, however, expect exports to decline sharply in July and August. SovEcon estimates that July sunflower oil exports fell by 53.9% from June, while August shipments could decline by another 40% year-on-year. Other analysts expect August exports to total only 100–150 thousand tons.

Industry experts believe that redirecting exports through the Baltic or Caspian ports will only partially offset the losses. Higher insurance premiums and freight rates have significantly increased logistics costs, while container shipments from Baltic ports to India now cost about $700–800 more per container than comparable routes from the Black Sea. In addition, several shipping companies have already revised their schedules because of security risks.

Another option is expanding rail exports using flexitank containers. This shift began in the spring, with part of the export flow moving to Russia’s northwestern and Far Eastern ports. However, industry representatives warn that developing new logistics chains will require significant investment, time and substantially higher transportation costs.

Analysts are also skeptical about the possibility of redirecting large export volumes to China through the Far East. Although China is one of the world’s largest vegetable oil importers, its market is dominated by soybean and palm oil, while sunflower oil accounts for only a relatively small share of consumption. Given the much longer transport route and intense competition, experts believe Russia is unlikely to fully replace its traditional Azov-Black Sea export routes with shipments to Asian markets.

Tags: Russia, sunflower oil, export, war