Global consumption of vegetable oils declined by about 2-3% in 2020 amid COVID-19. However, the pandemic, considered to be exceptionally negative factor, may have certain positive influence on the market of vegetable oils. The food demand for oils may increase by 10 mln tonnes per year in the world in 2021, declared the expert of LMC International, Aaron Hanson within Kazakh Oilseed Summit: Online Edition on January 21.
“The most significant decline of consumption of vegetable oils was observed in India in 2020. Indian demand decreased mainly in restaurant and catering segments, share of which was about 20-25% out of the total consumption of vegetable oils. Besides, the pandemic caused sizable decline of fuel consumption in many countries that resulted in collapse of crude oil prices followed by depreciation of vegetable oils”, - the expert pointed out.
However, lower activity of restaurant complex caused the decline of consumption of used oils in biodiesel industry in the world. This resulted in higher demand for vegetable oils that supported the prices of oils on the world market. Moreover, decline of oilseed crops due to unfavorable weather in the key producing countries supported the prices in the second half of 2020. Therefore, the prices of vegetable oils have been growing notably by the end of 2020.
“The prices of oils will decline in short-term. Demand and consumption in the key importing countries as well as from biodiesel industry will remain the main price-formation factors. The supply of oils will determine the prices as well. At the same time, we expect the prices of crude oil to be quite stable”, - A.Hanson said.