Stockpiles of the cooking oils used to make everything from candy bars to biofuels are declining to the lowest in two generations as farmers fail to keep up with demand expanding at five times the pace of the world population.
Inventories of soybean, rapeseed, sunflower and six other oils will drop to less than 29 days of consumption this year, the fewest since 1975, U.S. Department of Agriculture data show. Palm, the most-consumed oil, will rise 7 percent to 3,475 ringgit $1,103 a metric ton in Malaysian trading by the end of the first quarter, the highest since March, based on the median estimate of 12 analysts and traders surveyed by Bloomberg.
Supplies of oils and fats will be near the “critically low level” seen during the 2008 food crisis, the United Nations said in a report Nov. 3. While the UN’s world food index dropped 9 percent from a record in February as grain harvests expanded, a tighter supply of cooking oils is helping to keep the gauge about 20 percent higher than the five-year average.