Over the past two months, the price of the raw material used to produce rapeseed oil has decreased by nearly EUR 200 per ton, or up to one third. Rapeseed oil prices on store shelves, however, won’t be following suit.
According to Talis Raak, head of purchasing at Rimi, the retail price of cooking oil increased by 20-30% at the beginning of the first quarter. Prices stopped rising in April.
“In the case of both sunflower and rapeseed oil, the primary factor in the price decrease was mainly a restored supply chain, and at the moment, product availability is rather good,” Raak said.
Producers are nonetheless skeptical about further costs, however, as several countries have reduced yield forecasts for this year.
Alo Suvari, sales director at Estonian rapeseed oil producer Scanola, confirmed that the cost of the raw material used to produce rapeseed oil had gone down in recent months, but uncertainty over the future persisted.
According to Suvari, the price of rapeseed fluctuates daily.
“Volatility has increased quite a bit,” he said. “While daily changes used to be EUR 10, they’re significantly bigger now. The record is EUR 60-70 in a day.”
He acknowledged that it was difficult to gauge how much the retail price of rapeseed oil might change for buyers, noting that April’s peak prices didn’t reach store shelves either.
“In a broader perspective, prices are going up,” the sales director said. “Compared with right now, they may not increase.”
Nevertheless, he continued, long-term price changes will reach consumers as well.
“All cooking oil prices have doubled on year – there’s a Ukraine-sized hole in the market at the moment,” he explained. “When the price of cooking oil goes up, milk, butter – all animal and also plant products will go up as well.”
According to Martin Miido, communications director for supermarket chain Coop Estonia, a shortage of sunflower oil has increased demand for other cooking oils at their stores. On year, cooking oil prices at Coop stores, which include Konsum and Maksimarket supermarkets, have as much as doubled.
Despite the price increase, retailers say that cooking oil sales have remained steady.
Rapeseed oil in Estonian supermarkets currently costs an average of nearly EUR 3.50 per liter. (ERR/Business World Magazine)