Vegetable oil prices have resumed growth

For 27 days, Ukraine has resisted an attack by the Russian army, which continues to destroy cities and infrastructure and kill civilians. The world’s civilized nations are supporting Ukraine, helping and imposing sanctions on Russian companies to make Russians feel the cost of senseless aggression.

European governments are considering restrictions on oil and gas supplies from Russia to the EU, which will be the biggest blow to the Russian economy. Earlier, similar steps were taken by the United States and Canada. Further reduction of Russian oil supplies to the world market will lead to higher oil prices, which in turn will increase the price of vegetable oils.

May Brent oil futures on London’s ICE Futures rose 7.4% to $ 116 / barrel yesterday, and April WTI oil futures on the New York Mercantile Exchange (NYMEX) rose 6.8% to 110 $ / barrel, but today they are already trading at 118 and 112.8 $ / barrel, respectively.

May palm oil futures on the Malaysian stock exchange rose 2.6% yesterday to 5774 ringgit / t or $ 1372 / t, finally interrupting a long decline that began after reaching a record March 9, 7074 ringgit / t or $ 1680 / t .

The main reason for the fall in palm oil prices remains the seasonal increase in soybean oil supplies to the world market, as well as Indonesia’s decision to lift restrictions on palm oil exports and impose export duties instead. The decision provides for an increase in the maximum level of tax on palm oil exports from $ 375 / t to $ 675 / t. The maximum tax will be applied if the price of oil exceeds $ 1,500 / t.

May futures for soybean oil on the Chicago Board of Trade yesterday rose 2% to $ 1,623 / ton after oil and palm oil prices. They are supported by the lack of sunflower oil due to the blockade of ports in Ukraine and the reduction of supplies from Russia due to financial sanctions and the inability to make payments through Russian banks. Soybean oil prices reached a record $ 1,680 per tonne on March 1, and will remain high until the end of the war in Ukraine, given the shortage of sunflower oil supplies.

By the end of 2022, Argentina will increase the duty on soybean oil and meal exports from 31% to 33% in order to stabilize domestic prices and fill the budget.

Prices for sunflower oil reach 1800-2000 $ / t C&F, which is much higher than the prices for soybean and palm oil, so demand remains low.

According to the newspaper Chas Indii, since the beginning of the active phase of the war in Ukraine, prices for refined sunflower oil have risen 1.5 times to a record 3,000 rupees per 15 liters of bank or $ 2.62 / liter, while in March last year the price was maximum $ 2.1 / l. At the same time, soybean, peanut and palm oil are offered for $ 1.7-2.2 per liter in Indian markets.

India imports more than 70% of its sunflower oil from Ukraine and Russia, but supplies have stopped since the start of the war.