Key factors of palm oil in 1Q,2022

Palm oil uncertainties mean that prices continue to break historical records. The key factors to follow in 2022 that will mark the evolution of this oil are:

• Production in Indonesia and Malaysia
• Weather forecast
• Possible labour problems in Malaysia
• Discount versus soybean oil
• Fertilizer costs
• Import rates in India
• Mandates for use in biodiesel

In the case of sunflower, the uncertainty surrounding the conflict between Russia and Ukraine (between the two countries they export 80% of sunflower oil globally), combined with the high prices of other vegetable oils, are supporting its price. For the new harvest, a significant increase in planted area is expected.

Prices of all vegetable oils have risen sharply in the last month and a half, especially tropical fats, with palm kernel leading the way with a rise of more than 50% since mid-December. Its price has far exceeded that of coconut oil, which is unusual as palm kernel generally trades at a discount to coconut oil. Coconut and palm kernel oils, after a respite in prices during November, are now at their highest levels in recent years.