AWL Agri Builds Edible Oil Inventory Amid Global Supply Chain Volatility

India's AWL Agri Business has increased its inventory of imported edible oils to guard against supply chain disruptions caused by wars in the Middle East and Ukraine. The company, which is the market leader in India's edible oil sector and maker of Fortune cooking oil, has raised its inventory cover for imported edible oil from 30-35 days to 40-45 days.

CEO Shrikant Kanhere told Reuters that the decision was made to mitigate the risks associated with supply chain disruptions. 'Keeping in mind all this disruption, because we are living today in a very dynamic world and you don't know what's going to happen tomorrow, we have, to some extent, improved or increased the holding days,' he said.

India is the world's biggest edible oil importer, meeting nearly two-thirds of its demand through imports from countries including Indonesia, Malaysia, Brazil, Argentina, Russia, and Ukraine. The country's supply chain has been volatile in recent months due to lower imports, but refiners are rebuilding inventories to meet demand during the upcoming festive season.

The move by AWL Agri Business could help larger brands gain market share from smaller rivals as they can afford to hold larger inventories and avoid stock-outs. 'Supply chain volatility is becoming a medium-term baseline (and disruptions are) no longer viewed as short-term blips,' said Deven Choksey, managing director of fund and wealth manager DRChoksey FinServ.