This year, domestic edible oil prices continue to rise, and the safety of "oil bottles" has become a hot topic of public concern. In this regard, experts said that although our country’s edible oil is highly dependent on foreign countries, our country’s oil and oil capacity continues to improve, there is a perfect grain and oil reserve system, and there are also diversified oil and oil import channels. Therefore, our country has the ability to ensure the safety of "oil bottles".
Since the beginning of this year, the price of domestic edible oil has continued to rise. From the beginning of the year, the price of rapeseed oil has risen sharply, and then soybean oil has followed suit. Now that palm oil has been fried, the three major edible oil varieties are facing a trend of rising prices across the board. What is the reason for the rise in edible oil prices? Is the supply of edible oil in our country guaranteed? Some authoritative experts said in an interview with reporters that our country’s edible oil is highly dependent on foreign countries, but our country’s oil and oil capacity has been continuously improving, there is a perfect grain and oil reserve system, and there are diversified oil and oil import channels. It has the ability to ensure the safety of "oil bottles".
Multiple factors are driving up the price of rapeseed oil
Rapeseed oil is the second largest edible oil variety in our country, and it is also the first edible oil variety that has continued to increase in price this year. In terms of futures, the main contract price of rapeseed oil futures in Zhengshang has exceeded 10,000 yuan per ton, up nearly 30% from the beginning of the year, up about 50% from the low point in May, and a new high since 2013. In terms of spot, on December 11, the wholesale quotation of four-grade rapeseed oil in coastal areas was 9,850 yuan to 10,000 yuan per ton, up 1,850 yuan to 2,000 yuan from the beginning of the year, and up 2,850 yuan to 3,000 yuan from the low point in May.
Zheng Zuting, an economist at the National Grain and Oil Information Center, believes that the rise in rapeseed oil prices is the result of the superposition of various factors. First, the global supply and demand for edible oil represented by palm oil is tightening, and the world’s major rapeseed producing countries (regions) have reduced production due to drought, driving rapeseed and rapeseed oil quotations to continue to rise. The US Department of Agriculture forecasts that global rapeseed production will 69.17 million tons from 2020 to 2021, a decrease of 50,000 tons year-on-year. Second, due to factors such as land and labor, the domestic rapeseed production space is limited, and small oil factories and small workshops mainly produce fragrant rapeseed oil. Third, Canada is our country’s largest source of rapeseed imports. Due to the detection of harmful substances in its rapeseed, domestic enterprises are more cautious in importing rapeseed, and the import volume of rapeseed has declined. According to Chinese customs data, from January to October 2020, the total import volume of rapeseed in our country was 2.434 million tons, which is at a historically low level. Fourth, since 2015, our country has cancelled the rapeseed temporary storage policy and promoted rapeseed oil destocking. Now the rapeseed oil inventory has been digested, and the market supply is generally tight. In addition, the United States, Japan, the European Union and other economies continue to implement loose monetary policies, resulting in excess liquidity, and a large amount of capital enters the future market of agricultural products to pursue profits, driving the price of rapeseed oil to rise.
The consumption of rapeseed oil in our country accounts for 20% of edible oil, which is significantly lower than the 45% of soybean oil. However, there is a strong substitution between oil products, and the increase in rapeseed oil prices has little impact on residents’ living consumption. After the sharp increase in rapeseed oil prices this year, the consumption of soybean oil and sunflower oil has increased, and the consumption demand for rapeseed oil has been significantly suppressed. The National Grain and Oil Information Center predicts that from 2020 to 2021 (October to September of the following year) rapeseed oil consumption will reach 7.10 million tons, a decrease of 400,000 tons year-on-year.
Building a Diversified Import Pattern
Our country’s edible oil foreign dependence more than 60%, the domestic edible oil market and foreign markets are highly integrated, oil and oil market domestic and foreign price linkage is relatively strong, the inner disk will follow the outer disk to a large extent, making our country edible oil safety is facing great challenges.
Wang Ruiyuan, chief expert of the China Grain and Oil Society and honorary president of the Oil Branch, said that in 2019, the total output of the eight major oil crops in our country, such as rapeseed, soybean, peanut, cottonseed, sunflower seed, sesame, flaxseed, and camellia oleifera, reached 66.66 million tons, a record high in history. Although our country’s oil production has developed rapidly, it still cannot keep up with the demand for rapid improvement of people’s living standards. In the case that domestic oil cannot meet the demand, it has become an inevitable choice to continuously increase the import quantity of oil and oil. According to the statistics of China Customs, in 2019, our country imported a total of 93.308 million tons of various oils and 11.527 million tons of various types of edible vegetable oils. With the rapid increase in the number of domestic and imported oils and oils, the per capita edible oil consumption in our country has increased from 7.7 kg in 1996 to 28.4 kg in 2019, exceeding the world per capita level of 24.4 kg in 2017.
In recent years, international economic and trade frictions have intensified. In order to ensure the safety of edible oils, our country actively promotes the diversification of oil and oil import channels, optimizes cooperation with soybean producers in the Americas and palm oil producers in South East Asia, and expands cooperation with potential oil production areas in Europe, the Black Sea and Africa. In addition, our country should establish and improve the oil and oil trade policy system and import and export coordination mechanism, encourage and support enterprises (groups) with international resource integration capabilities to go abroad to carry out mergers and acquisitions in the upstream and downstream of the oil and oil industry chain, and support domestic enterprises to layout overseas oil and oil planting, warehousing, logistics markets, etc., to build China’s own multinational large grain merchants, master more oil and oil resources, and improve international trade influence.
Enhance the safety level of edible oil
The shortage of oils and oils is a shortcoming in the development of the edible oil industry in our country. A person in charge of a rapeseed processing enterprise in Hubei told reporters that their company had to stop production because they could not acquire rapeseed. Constrained by cultivated land area and fresh water resources, it will be more difficult for domestic oil planting area and output to continue to grow in the future. Experts believe that it is necessary to fully tap the growth potential of domestic oils and oils. On the basis of efforts to improve self-sufficiency, enrich and improve the reserves of oils and oils to ensure the safety of national oils and oils.
First of all, on the premise of not competing with grain for land, especially good land, we should adopt a development policy of multiple oils and strive to increase the area of oilseed planting. Continue to promote the soybean revitalization plan and stabilize the soybean planting area; expand the area of rape planting, encourage the use of winter idle fields in the southern region to increase rape planting, and steadily expand the area of northern spring rape planting; expand the area of peanut planting in Huanghuaihai and southern regions suitable for planting; continue to actively develop the production of woody oilseeds represented by Camellia oleifera and walnuts, and encourage the use of new Camellia oleifera forests and walnut forests on barren mountains and slopes; accelerate the development of oil sunflower, sesame seeds, oil sand beans, oil olives and other characteristic oil production; make full use of by-products of grain and oil processing such as rice bran, corn germ, wheat germ and other resources
Secondly, support domestic oil processing enterprises to become stronger and bigger. In recent years, our country’s oil processing enterprises have continued to grow and develop, forming a situation in which state-owned and state-controlled enterprises, private enterprises, Hong Kong, Macao, Taiwan and foreign-funded enterprises compete on the same platform. It is necessary to accelerate the promotion of oil processing enterprises, especially small and medium-sized enterprises, to update facilities and equipment, improve production technology, and improve processing capacity, and implement the "enterprise + base + farmer" business model. Further improve the oil market circulation system, actively develop new business formats such as e-commerce, chain operation, logistics and distribution, support a group of large-scale and powerful circulation enterprises, and cultivate the main channel for ensuring the supply of edible oil.
Finally, strengthen reserve regulation and emergency management. Adequate reserves are the "voltage stabilizer" of the market. It is necessary to improve the edible oil reserve management system and give full play to the function of reserve throughput regulation. Guide large-scale grain and oil processing and operation enterprises to rationally arrange commercial turnover inventory. Strengthen the analysis of supply and demand information in the edible oil market and market monitoring and early warning, strengthen the construction of edible oil emergency network system, and organize market release in a timely manner to ensure that it is not out of stock and continuous.