The United States Department of Agriculture (USDA) has projected that global vegetable oil production will hit a record-breaking 224.2 million tons in the current marketing year, surpassing last year's total by 2.7 million tons.

Consumption Boom

Global consumption is expected to reach 221.7 million tons, an increase of 5.3 million tons compared to the previous year. Despite the record production, this surge in consumption will lead to a drop in end-of-year stocks to 29.6 million tons, below both last year's levels and the long-term average.

Palm Oil Dominates

According to Agrarmarkt Informations-Gesellschaft (mbH), palm oil production will once again hit a record high in 2024/25. The USDA has slightly revised its forecast downward from 80 million tons to 79.8 million tons, which still represents an increase of 0.8 million tons from 2023/24.

Soybean Oil on the Rise

Thanks to ample raw material supplies, soybean oil production is expected to surge by 3.2 million tons, reaching an unprecedented 65.5 million tons. Similarly, rapeseed oil production is set to achieve a new record of 34.2 million tons.

Sunflower Oil Slump

However, the USDA anticipates a decline in sunflower oil production for 2024/25, primarily due to a significant reduction in output from Ukraine, down by more than 1 million tons. The global forecast has been revised to 20.6 million tons, nearly 1 million tons lower than the previous month and almost 2 million tons below last year's level, marking the lowest production since the 2021/22 marketing year.

This forecast paints a complex picture for the global vegetable oil market, with record-breaking outputs in some sectors juxtaposed against declines in others. The shifts in production dynamics, especially the expected drop in sunflower oil, could have significant implications for global supply chains and market prices.