Record-High Global Food Prices Imminent As Edible Oil Soars

Edible oil prices soared this week, prompting fears that record-high food prices could be imminent. On Wednesday, soybean oil futures in Chicago hit their highest levels since 2008, and palm oil, the commodity used in thousands of food products, jumped to new highs.

Soybean prices increased 1.4% to 71 cents per pound, the highest level since 2008. US canola futures are also on the verge of an all-time high, and palm oil in Malaysia hit a new record high of $1,434 per ton.

“Drought has crimped soybean crops across South America this season. Rival oilseeds like palm and canola have also suffered shortfalls from adverse weather and labor shortages. And escalating political tensions involving Ukraine and Russia pose a risk for sunflower oil exports, which the two countries dominate,” according to Bloomberg.

“for the supply side, everything that could go wrong, went wrong; problems “hit all the key producing countries, whether it’s palm oil or a competing oil. There’s no reprieve in the short term, and people are reacting to that.”

Earlier this month, Goldman Sachs’ Jeff Currie warned that shortages across commodities could send higher prices. He said markets are “incredibly tight from a physical perspective” … “we are out of everything, I don’t care if its oil, gas, coal, copper, aluminum, you name it we’re out of it.”

Soaring edible oils could be the next catalyst that catapults the FAO (Food and Agriculture Organization) Food Price Index (FFPI), a measure of the monthly change in international prices of a basket of food commodities, to a new record high for February. New FFPI data is expected in early March. As for now, FFPI sits near a record high in terms of January prices.

Abdul Hameed, director of sales at Manzoor Trading in Lahore, Pakistan, said the edible oil is in “uncharted territory,” and prices could climb even higher. He said, “the global supply and demand situation is a very, very big concern.”

For those in the Western world, food inflation is already leaving a mark on lower-income households, and the “worst has yet to come,” according to John Allan, chairman of Tesco Plc.

There Is No Way Food Prices Don’t Go Up (A Lot)

Russia produces roughly two-thirds of the world’s ammonia nitrate.

Russia introduces export ban on ammonium nitrate for two months — government – Business & Economy – TASS

Russia imposed a ban on ammonium nitrate export for two months, until April 2, the government’s press service said on Tuesday.

“The two-month ban on ammonium nitrate export comes into force from February 2. The relevant decree of the government was signed,” the press service said.

“This is a temporary measure. The remaining volume can be exported from April 2, when Russian companies will receive the ammonium nitrate in required volume and the demand for it on the domestic market will pass peak values,” First Deputy Prime Minister Andrey Belousov said.

“Wow, that’s a problem, Chris.” I know, right?

There is no way food prices don’t go up. A lot. I know I’ve mentioned this before, probably a few times, but it’s super important. When food prices rise to a point where they exceed 30% of disposable income, civil unrest and revolution become highly probable. Maybe not 2022, but at some point in the next few years we’re almost guaranteed a revolution, maybe more than one in countries which you’d never have thought such a thing possible.

Ammonium nitrate

Sticking with this part of the world.. Belarus bans transit of oil products, fertilisers from Lithuania

Belarus will ban oil and chemical products from crossing its territory from Lithuania, including fertilisers, in response to Lithuania’s decision to stop the transit of potash fertiliser from Belarus, the Belarusian foreign ministry said on Wednesday.

The ban comes into effect on Feb. 7, the ministry said, adding that the products in question amounted to 1.6 million tonnes a year, and were worth more than $1 billion.

Lithuania ceased transporting the potash, a major cash earner for Belarus, after the Vilnius government decided the transit goes against its national security interests.

Could it be that the market is waking up to what we’ve been hammering on about for two years now? That we’re going to have a food crisis and resource nationalism is going to become more popular than a “cancel Joe Rogan party” at Gavin Newsom’s place.

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.