Global Vegetable Oil Supply, Demand and Price Outlook by Thomas Mielke

Global Vegetable Oil Supply, Demand and
Price Outlook
At the 19th Indonesian Palm Oil Conference on 3 Nov 2023 in Nusa Dua, Bali
Thomas Mielke, ISTA Mielke, OIL WORLD,

Global Market Research on Oilseeds, Oils and Meals
<thomas.mielke@oilworld.de>
www.oilworld.biz Your Information Provider - - Independent, Unbiased, Authoritative - - Since 1958 3 Nov 2023
We have seen record veg oil and
Soya Oil & Palm Oil: Monthly Prices (US-$/MT) oilseed prices in March & April 2022,
2000 after Russia invaded Ukraine
1800 Last year the world was panicking

1600 about food supply. This concern has
Palm oil, crude cif Rott. Soya oil, Dutch fob ex-mill
eased. Prices have declined sharply.
1400
1200 Markets have shown their ability to
quickly react to supply interruptions
1000 (with supply & demand adjustments).
800
Big price swings of palm oil in past 3
600
years between US-$ 530 in May 2020
400 and US-$ 1900 in March 2022.
200
Supply concern will emerge again.
0
72 77 82 87 92 97 02 07 12 17 21
Monthly prices from January 1972 until October 2023
Daily Prices of Soya & Palm Oils (US-$/T) World palm oil supplies are currently
13 00 sufficiently large. Today’s bearish market
12 50 Argentine soya oil (fob) sentiment in veg oils is temporary.
12 00 Malaysian RBD palm olein (fob) World palm oil consumption increased
11 50
sharply on the year in 2022/23
11 00
10 50 Rel high production seen in Oct/Dec 23
10 00
95 0 Global production deficit likely in 2024.
90 0 Prices of veg oils to appreciate in 2024,

85 0 while oilmeal prices forecast to decline
80 0
75 0 I will discuss deviating global supply
and demand trends.
70 0 Geopolitical, financial, economic as well
Jan 23 Fe b Ma r Ap r Ma y Jun July Au g Se p O ct as weather uncertainties complicate
Daily prices from Jan 2023 until 31 O ct 2023 forecasting
Company Profil and Services
• ISTA Mielke GmbH – publisher of OIL WORLD - was founded in 1958
• ISTA = International STatistical Agricultural Information
• Leading private authority for global research and market analyses for
oilseeds, oils & fats and oilmeals. Internet www.oilworld.de
• Independent, not involved in trading, unbiased information
• Providing monthly and quarterly world supply and demand balances
• Daily, weekly and monthly reports on oilseeds, oils and oilmeals. Also a
Chinese Report in Mandarin.
• We want to be your provider for global analyses and forecasts
Strong demand growth of oils & fats
World Consumption of 17 Oils & Fats worldwide in the past 15 years for
food, energy and oleochemicals
2023/24F -- 257.0 Mn T 1993/94 - - 88.4 Mn T
Average annual growth in the 10
years ended
- 2003/04: +4.1 Mn T
- 2013/14: +7.1 Mn T
Palm Oil 16,3% - 2023/24: +5.6 Mn T
Palm Oil 32,0% Soya Oil 24,0% Rape Oil 10,8% The challenge for the years ahead is
Soya Oil 20,9%
produce sufficient supplies, in good
Sun Oil 8,5%
quality and at reasonable prices in a
Others/An.Fats 19,2% sustainable way
PKO&C NO 5,5%
Rape Oil 11,7%
The focus must be to raise yields per
Others/An.Fats 38,0% ha, owing to the limitations of land.
Sun Oil 8,7% PKO&C NO 4,5%
Yield increases in sunflowerseed,
rapeseed & canola and in soybeans
have been better than in oil palms.
17 Oils & Fats : World Consumption
Total Usage in Mn T
260 At the moment almost 20% of total
240 world consumption of 17 oils & fats is
absorbed by the energy sector.
220
200 In the years ahead:
180 - slowdown in biodiesel & HVO
160 - emerging SAF
140
Insufficient growth in world supplies
120 of UCO and other non-food
100 feedstocks in the years ahead will
80 keep dependence high for palm oil,
60 soya oil and rape oil requirements as
biofuel a feedstock for biofuel production
40
20 food and other
0
92/93 94/95 96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11 12/13 14/15 16/17 18/19 20/21 22/23
91/92 93/94 95/96 97/98 99/00 01/02 03/04 05/06 07/08 09/10 11/12 13/14 15/16 17/18 19/20 21/22
Total biodiesel production virtually
World Production of Biodiesel & HVO (Mn T) doubled in the past 10 years.
60 12
11 In Jan/Dec 2023 production esti-
50 Production (Y1) 10 mated to reach about 57 Mn T
Change (Y2) 9 (compared with 52.2 Mn T in 2022),
40 8 of which
7 - U.S.A. 13.2 Mn T
30 6 - Indonesia 10.5 Mn T
5 - Brazil 6.5 Mn T
20 4 - European Union 15.4 Mn T
- Argentina only 0.9 Mn T
3
10 2
1
0 0
-1
-10 -2
2010 2012 2014 2016 2018 2020 2022
2009 2011 2013 2015 2017 2019 2021 2023F
17 OILS & FATS : World Exports (Mn T)
60 With an export volume of 53.0 Mn T,
55 palm oil accounted for 54% of world
exports in Oct/Sept 2022/23
50
45 Today palm oil is still – by far - the main
40 backbone to satisfy world demand.
35 But its competitive position in global

30 markets has deteriorated
25 Soy, Rape, Sun Oils
20 4 Animal Fats
15 Palm Oil
9 Other
10
5
0
08/09 11/12 14/15 17/18 20/21 23/24F
PALM OIL : Exports of 3 Countries ( Mn T ) Palm oil exports of the 3 biggest supplying
Aug J an/ Aug countries were boosted by 3.5 Mn T on the year
Exports of: 2023 2022 2023 2022 2021 to 29.35 Mn T in Jan/Aug 2023
Indonesia. . . 3.02 3.88 19.07 15.45 19.00
Malaysia . . . 1.22 1.30 9.66 9.81 9.65
Thailand. . . . .01 .04 .61 .61 .31 All the increase occurred in Indonesia with an
Total . . . . . . 4.24 5.23 29.35 25.87 28.96 export volume of 19.1 Mn T (vs. 15.5), while
Thereof to: reductions occurred in exports of Malaysia. Little
EU-27 . . . . . .30 .48 2.70 2.85 3.63 year-on-year change in the rest of world.
Africa . . . . . .62 .67 5.09 3.61 4.15
Huge imports of India, China and African ctrs.
America . . . .17 .28 1.38 1.42 1.48
Record stocks in India slowed new purchases.
U.S.A. . . . . .14 .22 1.10 1.10 1.13
Brazil . . . . . .01 .03 .08 .12 .11
In early Sept 2023, palm oil stocks in Indonesia
Asia . . . . . . . 3.07 3.70 19.59 17.34 18.82
China, PR . .75 .77 4.01 2.54 4.14 were down about 2 Mn T from a year earlier
India. . . . . . .94 1.30 6.12 5.04 4.85
Bangladesh .09 .18 .94 .88 .96 Sharp year-on-year reduction in palm oil exports
Pakistan. . . .32 .27 2.17 1.89 2.20 in Aug/Dec 2023. Further decline anticipated in
Philippines . .07 .07 .54 .79 .78 Jan/June 2024.
Türkiye. . . . .15 .17 .78 .88 .64
Vietnam . . . .12 .09 .65 .57 .62
17 O IL S & F ATS : E xp o rts o f M ajo r Co u n tries ( Mn T) In calendar year 2023 Indonesia and
35 Malaysia likely to export 30.5 and 17.0
Indon es ia Mn T of oils & fats,
M ala ys ia thus accounting for 32% and 18% of
30 world exports,
Ar gentina
U .S.A.
25 C ana da
mainly palm oil
U k rain e
But we at Oil World forecast lower palm
20 R us s ia
oil exports in 2024 and also in 2025
15 What are the impacts and repercussions

if Indonesia and/or Malaysia fail to
10 provide the required quantities of veg oil
to the global market?
0
02/03 05/06 08/09 11/12 14/15 17/18 20/21 23/24F
Palm oil has lost its growth
dynamics.
Palm Oil Production 1981 - 2023
Annual growth is likely to slow in Major Countries (Mn T)
to only 1.7 Mn T or less in the 90
10 years to 2030 from an
80
Malaysia
average annual growth of 2.9
Mn T in the 10 years to 2020 Indonesia
70 Effects of El Nino
Rest of W orld
Threat of El Nino to cause 60
dryness in Sept/Dec 2023
50
and/or in early 2024
40
Palm oil is still dominating the
global market of oils/fats with a 30
production share of 32% and 20
an export share of 53% (from
only 6% of the area). 10
0
Palm oil the price leader 1983 1987 1991 1995 1999 2003 2007 2011 2015 2019 2023
1981 1985 1989 1993 1997 2001 2005 2009 2013 2017 2021
PALM OIL : World Production & Area
Annual Changes
10 2500
Mn T
production (Y1)
8 2000
mat. area (Y2)
6 1500
Thd ha
4 1000
2 500
0 0
-2 -500
-4 -1000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024F
January/December
Booming acreage expansion in
Deviating Trends of Harvested Areas Brazilian soybeans (an increase of 6
of Soybeans and Oil Palms (Mn ha) Mn ha during the past 3 years)
contrast with
50 - very little growth in North America
U .S .A . A rg e n tin a - a declining trend in Argentina
B ra zi l In do n e sia - a significant slowing in palm oil area
40
M al a ysia
Palm oil has lost its growth dynamics,
which will raise global dependence on
30 soybeans, sunseed & rapeseed
Future plant breeding will focus more

20 on raising the oil content, because of
the supply problems of palm oil as well
as increasing demand (for food and
10 biofuels, incl. SAF)
0
05/06 07/08 09/10 11/12 13/14 15/16 17/18 19/20 21/22 23/24F
04/05 06/07 08/09 10/11 12/13 14/15 16/17 18/19 20/21 22/23
The expansion in the Brazilian
AREA: Planted to Soybeans & Oil Palms ( Mn ha ) soybean area of 6 Mn ha during
Planted Area Planted Area the past 3 years is exceeding the
Soybeans(a) Oil Palms total palm oil area in Malaysia
Braz. Arg. Total Indo. Mal. Total
1990. . . 11.55 5.10 16.65 1.18 1.70 2.88 The growth in soybean plantings
2000. . . 13.69 9.00 22.69 3.33 3.28 6.61 has been much bigger than in
2010. . . 23.47 18.60 42.07 8.45 4.69 13.14 palm during the past 20 years - -
and even more so in the most
2020. . . 39.60 16.91 56.51 15.83 5.88 21.71 recent 3 years.
2023. . . 45.60 15.82 61.42 16.55 5.65 22.20
(a)Area planted for the crop harvested in the year shown.
Palm oil production has fallen sizeably
Annual Palm Oil Yields (T/ha) below trend already since 2019.
4,7 There has been an alarming decline in
4,5 T/ha average yields.
4,3 These are the challenges and constraints:

4,1
- lack of replantings (an estimated 30% of
3,9
oil palms in Malaysia are 19 years old or
3,7 older)
3,5
- a slowing down on new plantings
3,3 - sustainability and certification schemes
3,1 - shortage of workers
- rising production costs
2,9
- management issues
Malaysia Indonesia
2,7
2,5
02 04 06 08 10 12 14 16 18 20 22 2 4F
Palm oil production forecasts in Jan/Dec
PALM OIL : Production in Key Countries (Mn T) 2024:
50
Malaysia Indonesia Indonesia: virtually stagnating in 2024
45
(slightly higher in Jan/June 2024, followed
40 by a year-on-year decline in July/Dec)
35
Malaysia: close to 18.4 Mn T
30
25 Slightly lower in Thailand
20 Moderately higher production in Central

15 America and Africa
10
5
0
2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023F
2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024F
January / December
World Production of 4 Veg Oils in Mn T
17 OILS & FATS : World Production (Mn T)
90 October / September
p a lm o il
13/14 18/19 23/24F
80 s o y a o il Palm oil 60.2 78.1 81.3
ra p e o il change +17.9 +3.2
70
s u n o il
60 4 a n im a l f at s
Soya oil 45.4 56.8 61.6
9 o t h e r o ils change +11.4 +4.8
50
40
Sun+rape oil 43.0 45.6 52.6
30 change +2.6 +8.0
20
10 Big increase in world production of sun oil
and rape oil continuing in Oct/Dec 2023,
0 but significant slowing down in Jan/Jun 24
02/03 05/06 08/09 11/12 14/15 17/18 20/21 23/24F
World Production of 4 Major Oils In Summary:
The growth in world production of
Change on Year in Mn T sunflower and rapeseed oils is
estimated to slow from a combined 5.5
5 Palm Oil Soya Oil Sun Oil Rape Oil Mn T in 2022/23 to only 0.7 Mn T in
4 2023/24, thus reducing their ability to
contribute to the satisfaction of rising
3 world consumption.
2 The year-on-year growth in palm oil

production in 2023/24 will be the
1
smallest in 4 years at 0.2-0.3 Mn T
0 (probably stagnating or even declining)
-1 Much larger dependence on soya oil in

2023/24. Production is forecast to rise
-2 by 2.2 Mn T, all of which in Jan/Sept.
-3
20/21 21/22 22/23 23/24F
October / September
The 2023/24 outlook for soybeans and other oilseeds
World soybean production forecast to
10 Oilseeds: World Production (Mn T) rise by 25 Mn T to a new high of 394
400 Mn T in 2023/24.
375
Global soybean production surplus of
350 15 Mn T anticipated by Oil World.
325 Rising stocks.
Soybeans
300
But there are high weather risks.
275
250 Production of 9 other oilseeds is seen
declining by a combined 2 Mn T in
225
2023/24, following a boost by 6 Mn T a
200 year earlier
Other 9 oilseeds
175
150 Better than expected sunflowerseed &
125 rapeseed crops in Russia + Ukraine
100
03/04 05/06 07/08 09/10 11/12 13/14 15/16 17/18 19/20 21/22 23/24
Growing importance of S. America
Soybean Crop Trend Since 75/76 (Mn T)
220 In 2023/24 world production forecast
by Oil World to reach 394 Mn T
200
Argentina, Brazil & Paraguay (compared with 370 one year & 280
180 ten years ago).
160
Our current 2023/24 estimates:
140 U.S.A. 111.7* in 23/24 (vs 116.4)
120 Brazil 160.0* (vs 158.0)
Arg. 46.0* (vs 21.0)
100 Paraguay 10.0* (vs 9.5)
80 India 10.1 (vs 11.0)
U.S.A.
60 In Argentina soya plantings preferred
40 over other crops next season.
Record Brazilian production and
20 exports of soybeans.
0 Weather uncertainties. Discussion on
75/76 81/82 87/88 93/94 99/00 05/06 11/12 17/18 23/24F Brazil, Argentina, S.E.Asia.
Next season‘s outlook for soybeans and other oilseeds
Growing importance of soybeans
World Production of 10 Oilseeds worldwide and further big growth
ahead. But demand uncertainties.
2023/24 -- 633.7 Mn T 2002/03 -- 329.9 Mn T
At the moment 1.0 Mn T of
soybeans are used every day
S oybeans 62,2% S oybeans 59,6%
Other 5,6%
Other 5,5%
Rapeseed 10,1% Groundnuts 7,1%

Groundnuts 5,5%
Rapeseed 11,8% Cottonseed 10,2%

Cottonseed 6,2% S unseed 7,3%
S unseed 8,8%
SUNFLOWERSEED
World Production (Mn T) and Area (Mn ha)
60
55
Production
RAPESEED & CANOLA
50 World Production (Mn T) and Area (Mn ha)
45 80
75
40
70
35 65 Production
60
30
55
25 50
Harvested Area 45
20
40
15 35
0 5/06 0 9/10 13 /14 17 /18 21 /22 30
0 3/04 0 7/08 11 /12 15 /16 19 /20 23 /24 F Harvested Area
25
20
15
03/04 05/06 07/08 09/10 11/12 13/14 15/16 17/18 19/20 21/22 23/24F
02/03 04/05 06/07 08/09 10/11 12/13 14/15 16/17 18/19 20/21 22/23
17 OILS & FATS: Production & Use The growth in world production of
oils & fats is forecast to slow to 4.2
Change From Year Ago i n Mn T Mn T in Oct/Sept 2023/24.
16
14 But stocks worldwide were ample
12 in early Oct 2023, which is the start
10 of the new season.
8 There are uncertainties on the
6 demand side.
4
2 Prospective global production
0 deficit in 2023/24 is likely to lead to
an appreciation of veg oil prices.
-2
P ro d u c tio n C o n su m p tio n
-4 Sharply higher soybean crushings
16/17 18/19 20/21 22/23 will bring oilmeals under pressure
15/16 17/18 19/20 21/22 23/24F in 2024.
Octo be r / Se pte m be r
17 OILS & FATS: World Ending Stocks
C han ge on the yea r (Mn T)
5
4
3
2
1
0
-1
-2
17 oils/fats palm oil
-3
-4
-5
15 /1 6 17 /1 8 19 /2 0 21 /2 2 23 /2 4F
World Stocks in Percent of Annual Usage (%)
24
22
20
18
16
14
12
17 oils & fats
10
10 oilseeds
8
06/ 07 08/ 09 10/1 1 12/1 3 14/1 5 16/1 7 18/1 9 20/2 1 22/2 3
05/ 06 07/ 08 09/ 10 11/1 2 13/1 4 15/1 6 17/1 8 19/2 0 21/2 2 23/2 4F
At th e en d o f th e seaso n
Monthly Prices of Crude Palm Oil (US-$/T)
1 90 0
1 80 0
1 70 0
1 60 0
1 50 0 Palm oil prices are currently close
1 40 0 to their lows
1 30 0
1 20 0
1 10 0
1 00 0
9 00
8 00
7 00
6 00
5 00
4 00
Crude P alm Oil, cif Rott.
3 00
2 00 ave ra ge 1999 -200 8
1 00 ave ra ge 2009 -201 8
0
2004 2006 2008 2010 2012 2014 2016 2018 2020 2023
J anuary 2004 unt il Oc tober 20 23
Monthly Prices of 2 Oils and Premium/Discounts There are many uncertainties (more than
2000 usually) which complicate price forecasting.
US-$/T Major price pressure came from sun oil.
1800
1600 Palm oil prices declined of late. At around US-
$ 810 (fob) they are currently undervalued. It
1400
appears that only a few triggers are needed to
1200 push prices higher. (it could be deteriorating
1000 weather in a major area, recovery of
purchases, geopolitical developments, export
800 restrictions, etc.)
S o ya oi l, A rg . fo b
600 R BD p a lm o le in , Ma l., fo b
- Palm oil production below potential
400 p re m iu m /d isc ou n t - Low palm oil stocks in Indonesia
200 - Soya and rape oil prices will be supported by
rising biofuels productions in N. & S. America
0
-200 Palm oil prices seen appreciating by at least
Jan20 Jan21 Jan22 Jan23 Jly US-$ 100 within the next 4-6 months.
The deferred positions reflect this only partly.
M onthly aver ages from Jan 2020 until O c tober 2023
Thank you
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Global Vegetable Oil Supply, Demand and Price Outlook by Thomas Mielke

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Global Vegetable Oil Supply, Demand and

Thomas Mielke, ISTA Mielke, OIL WORLD,

1800 Last year the world was panicking

90 0 Prices of veg oils to appreciate in 2024,

35 But its competitive position in global

15 What are the impacts and repercussions

Future plant breeding will focus more

4,3 These are the challenges and constraints:

20 Moderately higher production in Central

2 The year-on-year growth in palm oil

-1 Much larger dependence on soya oil in

Rapeseed 10,1% Groundnuts 7,1%

Rapeseed 11,8% Cottonseed 10,2%

© Copyright 2023 ISTA Mielke GmbH.

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