Cooking oil prices are anticipated to go down progressively from June as Indonesia, the largest producer and exporter of palm oil, has announced it will lift its export ban on May 23. Supplies of sunflower oil from Ukraine are also expected to improve as the Russia-Ukraine war stabilizes.
The lifting of the export ban will help increase the availability of edible oil. Indonesia produces 46 million tonnes of palm oil a year. It consumes 9 million tonnes of this as food and another 9 million tonnes in its biodiesel programme, and exports the remaining 28 million tonnes.
The market had come down by 5% after Indonesia announced on May 19 that it would lift the ban on the export of palm oil. However, as it was subsequently clarified that exporters would have to meet domestic market obligations, prices again increased by 4% on May 20.
Indonesia has asked its cooking oil industry to reserve 10 million tonnes of palm oil for domestic consumption. Traders said the availability of different types of cooking oils would improve in the coming months.
Indonesia’s palm oil production season begins now and peaks by September. Meanwhile, the supply of sunflower oil is also improving. India’s monthly consumption of sunflower oil before the outbreak of the Russia-Ukraine war was 200,000 tonnes, which declined by half as supplies from the Black Sea region came to a standstill.
Now that the war is calming, sunflower oil supplies from Ukraine are slowly picking up by small barges, railways and roads. India’s sunflower oil supplies are expected to increase by another 20,000 tonnes to 25,000 tonnes per month.