Buyers have cancelled as much as 100,000 tonnes of planned palm oil purchases in the past seven days, according to Sandeep Bajoria, chief executive officer of Sunvin Group, a Mumbai-based trader and broker of vegetable oils.

“We can’t buy at these prices,” he said. “Demand destruction is happening.”

It’s what banks and even palm oil producers have warned about: sky-high prices will eventually result in consumers scaling back purchases or simply not be able to afford it anymore.

The tropical oil rallied to a record high of RM8,000 a tonne in Malaysia this week, joining a sweeping rally in commodities, as Russia’s invasion of Ukraine sparked fears that raw material supplies will fall short.

India is especially vulnerable to soaring vegetable oil prices as it relies on imports for 60% of its needs. It mainly buys palm oil from Indonesia and Malaysia, soybean oil from Argentina and Brazil, and sunflower oil from Ukraine and Russia, where shipments have been at risk of disruption.

As buyers are forced to cancel purchases, India is counting on existing stockpiles and an incoming domestic rapeseed crop to meet demand.

The South Asian nation has enough cooking oil inventories for about 45 days of use, Bajoria said. Data from the Solvent Extractors’ Association of India showed stockpiles at a four-month high at the start of February.

Domestic production of rapeseed sown in winter is set to be a record 11.46 million tonnes in 2021-22, according to the farm ministry. That could bring some much-needed relief to the high retail prices of edible oils in India.

India’s palm oil imports will slip to 500,000 tonnes in March from over 525,000 tonnes last month, Bajoria predicts. Purchases could fall sharply in April, he said.

High palm oil prices will bolster demand for soybean oil, with India set to increase imports to 400,000 tonnes in March from about 345,094 tonnes last month, Bajoria added.