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Oleic Acid Prices Fall in Europe and the USA as Feedstock Palm Oil Cost Plummet
Oleic Acid Prices Fall in Europe and the USA as Feedstock Palm Oil Cost Plummet

Oleic Acid Prices Fall in Europe and the USA as Feedstock Palm Oil Cost Plummet

  • 02-Jun-2023 3:50 PM
  • Journalist: Francis Stokes

Oleic Acid prices have been decreasing in the Netherlands and the USA in the month of May owing to several factors, including increased production, lower demand, and a strong US dollar.

Increasing production is one of the main reasons for the decrease in Oleic Acid prices. The global supply of Oleic Acid has increased in recent months due to several factors, including increased production in major producing countries such as Indonesia and Malaysia. This has led to a decrease in prices, as sellers have been forced to compete with buyers. This has led to an oversupply of Oleic Acid in the market, which has pushed prices down. Another factor that has contributed to the decrease in Oleic Acid prices is lower demand. The market for renewable oils is expanding, and the manufacturing of biodiesel is using more and more vegetable oils, which has resulted in a decline in the demand for the product in recent years. Furthermore, the strong US dollar has also played a role in the decrease in Oleic Acid prices. In recent months, the US dollar has been stronger than other currencies, making Oleic Acid more expensive for buyers in other countries.

The two countries with the highest Oleic Acid production rates worldwide are Indonesia and Malaysia. In 2018, Indonesia produced 1.9 million tons of Oleic Acid, while Malaysia produced 1.5 million tons. Both countries have increased production in recent months in response to the growing demand for Oleic Acid. On the other hand, the global economy has slowed down in recent months, which has led to a decrease in demand for several commodities, including Oleic Acid. Due to the fact that both China and the United States are significant importers of Oleic Acid, the ongoing trade conflict between the two nations has also impacted the commodity's sluggish demand.

Additionally, another factor that influenced the market situation of Oleic Acid is the raw material Palm Oil. The global Palm Oil market is currently oversupplied, with production outpacing demand. Also, palm oil extraction has been related to deforestation and other environmental issues, and there are rising worries about its sustainability. These factors have put downward pressure on Palm Oil prices in Europe. In the past year, the price of palm oil has fallen by about 20%.

According to ChemAnalyst, Oleic Acid prices may continue to drop in the near future. Many Oleic Acid companies are finding it difficult to turn a profit; some have even had to stop manufacturing. Oleic Acid demand might pick up, though, which could lead to a price hike.

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