Real oilseed prices to remain under pressure over next decade – FAO

The Joint Agricultural Outlook of the Organisation for Economic Co-operation and Development (OECD) and the Food and Agriculture Organization of the United Nations (FAO) expects oilseed and oilseed product prices to increase modestly over the forecast period.

Despite the coupling of meal and oil production, higher demand is expected for vegetable oil, and the price of this product is projected to rise. This will also push up the price of other oilseeds relative to soybeans, as they contain more oil, the Outlook notes.

The value of global agricultural and fishery consumption is also projected to rise by 13% over the next decade from current levels by 2034 in constant US dollars, with virtually all of the increase in consumption occurring in middle- and low-income countries. This growth will be driven mainly by rising wealth and increasing urban populations in these regions.

The share of India and Southeast Asia, the main drivers of growth among lower-middle-income countries, will increase to 39% of consumption growth by 2034, up from 32% over the past decade. Population, income, and urbanization growth in the region are expected to boost demand for both staple foods and animal products, thereby facilitating greater use of commodities in both food and feed.

In contrast, China, which has played a leading role in shaping global demand over the past decade, is projected to account for only 13% of additional consumption growth by 2034, down from 32% in the previous decade. This shift is driven by a shrinking population, slowing disposable income growth, and stabilizing diets.

Tags: prices, oilseeds