Cooking oil prices skyrocket as supply disrupted

More expensive products like soybean, sunflower and rice bran oil have surged by 90 percent since 2020 to VND68,000-85,000.

Hoa, a shop owner in HCMC’s Go Vap District, said since edible oil prices had been changing constantly she stopped stocking expensive items.

Despite discounts, edible oil has seen the highest price rise in supermarkets.

“The surging prices have affected demand”, a supermarket manager in HCMC’s Binh Thanh District said.

Producers blame the rising prices on higher input costs.

Price of palm oil, a leading edible oil, has quadrupled in the last two years.

Indonesia, the world’s biggest palm oil producer, has halted exports to contain soaring prices of the product.

The day after it did so on April 28, prices jumped by 2.74 percent to RM7,401 (US$1,612.6) per ton, according to the Malaysian Palm Oil Council.

Other production costs, including transportation and packaging, have also been rising sharply in recent months.

“Prices are likely to rise further in the second half of this year if the world market remains volatile, causing shortages in some countries,” an executive at a cooking oil company forecast.

India, the world’s top buyer of palm, soybean and sunflower oil, is suffering from rising prices following supply disruptions caused by the conflict in Ukraine, adverse weather in South America and a labor shortage in Malaysia.

Ukraine and Russia used to account more than 75 percent of global exports of sunflower oil, one of the world’s four leading edible oils, while Brazil and Argentina are among the largest soybean oil suppliers to India.

The same shortage has happened in Europe, with British supermarkets rationing cooking oil and prices quadrupling in Spain following panic buying.

Business website Trading Economics expects palm oil prices to scale a new high of $1,665 in the next 12 months.