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This year's market is destined to be unstable.
The energy market has fluctuated with the continuous evolution of geopolitical conflicts and sanctions; the food market has been affected by changes in the supply and demand pattern; and the edible oil market has been fluctuating at a high level.
Not long ago, Indonesia, the world's largest vegetable oil exporter, suddenly announced the suspension of vegetable oil exports, stirring up thousands of waves with one stone. Subsequently, Canada, the world's largest exporter of rapeseed oil, also said that the country's rapeseed cultivation may be reduced by 7%, making the edible oil market storm again.
First, Indonesia suspended exports, and Canada faced production cuts
Indonesia is the world's largest producer of palm oil, while international palm oil prices rebounded in January after a brief decline. The reason for the rebound is mainly due to the impact of labor shortages in Indonesia, and the export supply of palm oil is expected to be lower.
In fact, this concern is not without reason. Not long ago, Indonesia announced that it would launch an export ban on edible oil and palm oil products on April 28 in order to smooth the impact of rising oil prices on the country.
According to the data, in 2020/21, Indonesia's palm oil production reached 43.5 million tons, accounting for 59.70% of the total global production, ranking first in the world; while the global palm oil export volume was 47.94 million tons, of which Indonesian palm oil exports were 26.87 million tons, accounting for more than half. Therefore, after the announcement of Indonesia's export ban, it triggered a major shock in the global edible oil market.
Indonesia's blockbuster news market has not yet been digested, followed by Canada recently said that in the context of the tight global food supply and demand pattern, the country's farmers tend to grow more grains, which may reduce the sowing of rapeseed, or lead to a 7% decline in rapeseed sown area. Rapeseed is the main raw material of rapeseed oil, and if rapeseed is facing a reduction in production, it means that rapeseed oil production will be reduced.
Canada is the world's largest canola exporter and the second largest producer of rapeseed (after the European Union), but since last year, Canada's rapeseed has also been "troubled", first extreme drought weather has reduced rapeseed production by nearly 1/3, and recent floods have also added to the difficulty of spring sowing in May this year.
Second, the price of edible oil is running at a high level
Compared with the sharp fluctuations in the energy market and grain prices, the price of edible oil has remained high.
Looking back at the global food price index data released by the Food and Agriculture Organization of the United Nations, since the beginning of this year, the global food price index has shown a continuous upward pattern, averaging 135.7 points in January, up 1.1% month-on-month; rising to 140.7 points in February, an increase of 3.9% month-on-month; and rising to 159.3 points in March, up 12.6% month-on-month, and setting a new high in 30 years. In this continuous rise, the category with the largest increase is vegetable oil.
According to the data, the global vegetable oil price index in January was 185.9 points, an increase of 4.2% month-on-month, the highest increase among all categories;
The largest increase in the food price index in February was still the vegetable oil price index, up 8.5% month-on-month;
By March, the vegetable oil price index had risen by 23.2% month-on-month, a record high.
The vegetable oil price index has risen sharply in a row, reflecting the increase in global vegetable oil prices. In addition to the palm oil and rapeseed oil mentioned above, soybean oil and sunflower oil also showed large increases.
The rise in soybean oil prices is mainly affected by the reduction in soybean production in South America, which has led to a decline in soybean export expectations and tight supply and demand. On the other hand, although U.S. farmers tend to grow more soybeans, the weather is still an unstable factor, and weather speculation and soybean prices are in the same shadow, increasing the supply and price risk of soybeans.
Sunflower oil, on the other hand, was directly affected by the Russian-Ukrainian conflict and the sharp decline in exports. Because Russia and Ukraine are both big exporters of sunflower oil, the sunflower oil exports of the two countries together account for more than 70% of the total global exports, with the outbreak and continuation of the Conflict between Russia and Ukraine, the price of sunflower oil has risen sharply.
In addition, with the high price of crude oil, the demand for biodiesel has become strong, which has also tightened the global supply and demand of edible oil, which has contributed to the rise in edible oil prices.
III. What is the impact on the mainland?
The sharp rise in global edible oil prices has inevitably affected the mainland. The mainland's edible oil dependence on foreign countries is relatively high, and the linkage between domestic and international markets is strong, so the price of domestic edible oil is also under pressure.
From the perspective of growth, the price of edible oil on the mainland rose by 8.6% last year, far lower than the 65.8% increase of international edible oil, but higher than the 1.1% increase in domestic grain prices. However, in the follow-up, the probability of a big rise is not expected.
The first reason is that the consumption of edible oil in the mainland is mainly soybean oil, vegetable oil and peanut oil, and palm oil, sunflower oil, etc. are relatively small, so the impact is relatively small.
Second, this year, under the policy of "expanding beans and expanding oilseeds", domestic soybeans and oil crops will increase significantly, which will alleviate some domestic demand and reduce external dependence.
Third, as people pay more and more attention to dietary health, the overall demand for edible oil is gradually declining.
However, with the increase in uncertainties in the global edible oil market, and the mainland to comprehensively enhance the oil and fat industry also needs to have a process, so although the domestic edible oil market does not have the basis for a sharp price increase, it is still inevitably affected by the global market, and the oil bottle will still be high.
Welcome to pay attention to the "New Agricultural Concept" and understand the new development of the three rural areas in the new era.