iGrain India - Edible oil prices are expected to decrease by 8-10% in India by mid-December, following a decline in the international prices of soybean oil, sunflower oil, and palm oil. Over the past fortnight, the export offer prices for these oils have dropped significantly—soybean oil from $1230 to $1130 per ton, sunflower oil from $1300 to $1200 per ton, and palm oil from $1320 to $1220 per ton.
Several factors are contributing to this price drop:
Sufficient Global Production of Soybeans: The abundant global supply, especially with record soybean production expected in South America next year, has pressured soybean oil prices. This is compounded by potential changes to US biodiesel policies, which may reduce demand for vegetable oils in biodiesel production.
Declining Sunflower Oil Prices: The drop in sunflower oil prices is partly due to a temporary global oversupply, but this trend could reverse if Russia imposes a higher export duty, which is expected to take effect next month.
Palm Oil Price Drop: Palm oil prices have fallen as well, largely because of delays in Indonesia's planned increase in the mandatory palm oil content for biodiesel production, which was expected to rise from 35% to 40%. The uncertainty regarding this policy change has contributed to lower palm oil prices.
Additionally, the price of mustard oil in India has also dropped by Rs 10 per liter to Rs 136. Despite the price reductions in soybean, sunflower, and palm oils, the fall in sunflower oil prices may only be temporary, depending on Russia's export policies. Overall, these trends suggest a significant decrease in edible oil prices by mid-December.
