In the 2017/18 season the world’s biggest producers of sunflower oil – Ukraine and Russia – opted for increasing palm oil imports, UkrAgroConsult’s analysts note.
In Ukraine, palm oil purchases have been growing over the past three seasons, and they closed MY 2017/18 at 234 KMT. However, this is almost twice less than a record 430 KMT imported in the 2007/08 season.
Last season, palm oil imports in Russia hit an all-time high of over 1 MMT, continuing a long-term upward trend.
Obviously, the price situation in the vegetable oil markets “plays into the hands” of palm oil, making it more competitive due to low prices.
This effect is also enhanced by a widening price spread between sunflower and palm oils, which reaches USD 130-160/MT this season.
In addition, the authorities of Malaysia and Indonesia – the world’s top producers of palm oil – often use available tools for regulation and promotion of their product. This implies the sunflower oil market should not be expected to strengthen its position in the short term.
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