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Sunflower Oil Prices Likely to Increase in the US at the Beginning of Q3 2023
Sunflower Oil Prices Likely to Increase in the US at the Beginning of Q3 2023

Sunflower Oil Prices Likely to Increase in the US at the Beginning of Q3 2023

  • 25-Jul-2023 3:46 PM
  • Journalist: Stella Fernandes

The price of Sunflower Oil in the United States is projected to surge with the start of July, and the trend is expected to continue until the end of the third quarter of 2023. Certain factors are expected to support this higher pricing sentiment in early July, primarily including dry weather in the U.S., which has already impacted the production and supply of Sunflower Oil across the country. Apart from that, another aspect that is likely to support the upsurged pricing trend for Sunflower Oil includes Russia's move to pull out of its grain deal with Ukraine, a top producer, and exporter of Sunflower Oil on the overseas market. Additionally, vegetable oils are often used as a substitute for other cooking oils, including olive oil, which has been on the rise in recent months, and canola oil. Since Sunflower Oil is one of the most popular cooking oils in the U.S., it is no surprise that higher prices for Sunflower Oil will affect consumers nationwide. Higher prices for cooking oils are also likely to result in higher food prices across the board.

In addition, Sunflower Oil shipments to various regions in the global market, including the United States, have been suspended after Russia announced on July 17 that it was withdrawing from a year-long agreement that allowed grain and other food shipments to pass through the Black Sea's Russian naval blockade. Higher food prices will also make it harder for importing countries' consumers to afford food, particularly in low-income nations, which could increase hunger and malnutrition.

Besides that, El Niño, a weather effect resulting in drought and flooding, is likely to impact food production severely. However, the climate crisis is already impacting the supply of certain crops and the food industry in the past months.  An El Niña is a weather event that causes extreme weather conditions in the Southern Hemisphere. El Niños typically form in the Central and Eastern Pacific Ocean, close to the equator, and typically cause heavy rains and flooding in the southern United States and South America and drought in Southeast Asia and Australia. In the United States, the effects of an El Niño include damage to the sowing, growing, and harvesting of crops like Sunflower Oil all over the country, resulting in drought conditions in some areas and excessive rainfall in other areas. Countries may resort to protectionism during El Niño, which poses a risk of restricting the export of crops, such as Sunflower Oil, due to dwindling production. As a result, this affects the supply of edible oils, grains, and other foodstuffs across the global market, leading to higher prices.

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