Agri Business

Edible oil prices could fall in H1 of 2022 on higher output: Mielke

Reuters Panaji | Updated on September 25, 2021

Says pent-up demand could emerge once prices correct after rally in edible oil prices

Edible oil prices are likely to fall by a moderate $100 per tonne the rest of the year and accelerate their decline in the first half of 2022 as production increases, leading analyst Thomas Mielke said on Saturday.

Malaysian RBD palm olein prices could average $920 per tonne in the first half, down nearly 23 per cent from the current level, Mielke, Head of Hamburg-based analyst firm Oil World, told the Globoil India conference.

Argentinian soy oil could average $1,050 per tonne in the first half and Black Sea sunflower oil $1,040, he said.

Moderate price decline

“We expect some moderate price decline in the next three months in vegetable oils under the lead of sunflower oil followed by palm oil and soy oil, probably by $100 per tonne,” Mielke said.

Sunflower oil prices need to correct to regain market share after losing their edge to rivals because of higher prices this year, he said.

Global soy oil production could rise by 2 million tonnes in the year from October 1 to 61.68 million tonnes, while sunflower oil output could rise by 3 million tonnes to 22 million tonnes, he added.

Also see: India’s palm campaign has hard road ahead with water, seedlings scarce

Palm oil output could rise by 3.5 million to 4 million tonnes in 2021/22, accelerating from the 1.7-million-tonne rise for the same period a year earlier, he said.

Benchmark prices

The benchmark crude palm oil prices have jumped nearly a quarter so far this year, rallying for a third consecutive year as a pandemic-induced labour shortage crimped output in the world’s second largest producer — Malaysia.

After a rally in edible oil prices squeezed demand, especially in developing countries, pent-up demand could emerge once prices correct, Mielke said.

China’s soybean imports are likely to rise soon and crushing could increase by 4 million tonnes in the next season, he said.

Published on September 25, 2021

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

This article is closed for comments.
Please Email the Editor

You May Also Like