Commodities 2022: European vegetable oil markets expecting production rebound in the year
- Wed, 5 January 2022
The Black Sea sunflower oil market faces challenges in 2022 as
farmers hold onto seed stocks in the first half of the year, but record
sunflower oil production is still expected.
India -- one of the
main global importers -- is set to increase their vegetable oil imports
to 14 million mt in the marketing year of 2021-2022, largely driven by
sunflower oil. Sunflower oil imports are expected to rise to 2.4
million mt in 2021-22 from an estimated 1.88 million mt in 2020-21,
resulting from steep cuts in import duties and improve global
production. India has reduced import taxes on edible oils on multiple
occasions over the course of 2021 to combat rising international prices.
Initial estimations for the sunflower oil harvest in Ukraine were not
promising, as expectations arose of a reduction in the forecast yield
caused by a hot, dry summer in the Black Sea region will dampen further
supply in the market.
Despite this, a record 7.1 million mt of
sunflower oil is expected to be produced in the Ukraine in 2021-2022, up
23% from 2020-2021.
Following a bullish year in the European
crude palm oil market -- as prices have increased from $1045/mt to
record highs of $1377.50/mt -- market participants have expressed prices
may not ease until the end of the first quarter, resulting from an
unresolved labor shortage in Malaysia in combination with high duties in
rival producer Indonesia.
