Significant Price Increase in Sunflower Oil
At the recent tender held by the Egyptian General Authority for Supply Commodities (GASC) on June 13, the purchase price of sunflower oil saw a notable rise, while the price of soybean oil remained relatively stable compared to the previous tender. The tender aimed to secure 40,000 tons of vegetable oil, with delivery windows from July 20 to August 5 and/or August 15 to 31, 2024. The target was to acquire 30,000 tons of soybean oil and 10,000 tons of sunflower oil with immediate payment terms.
Higher Offer Prices Despite Increased Submissions
Compared to the tender on May 9, there was a significant increase in the number of submitted offers, accompanied by higher prices. Specifically, there were 17 offers for sunflower oil, priced between $1085 and $1163 per ton C&F, which is $85-100 per ton higher than the previous tender. Additionally, 13 offers for soybean oil ranged from $1045 to $1155 per ton C&F, showing an increase of $50-80 per ton.
Purchases Made by GASC
As a result of the tender, GASC purchased:
- 5,500 tons of sunflower oil from Mahsul Trading at $1073.9 per ton C&F, which is $73.9 per ton higher than in May.
- 12,000 tons of soybean oil from Mahsul Trading at $1003 per ton C&F.
- 5,000 tons of soybean oil from Posco Int at $1003 per ton C&F, both with delivery from August 15-31.
It’s important to note that the payment terms for these purchases were immediate after delivery, unlike the 180-day payment period in the previous tender.
Comparative Analysis of Past Tenders
For context, on May 9, GASC had purchased 73,000 tons of sunflower oil at $1000 per ton C&F and 29,000 tons of soybean oil at $994 per ton C&F with a 180-day payment period. Earlier on March 28, GASC purchased 28,755 tons of sunflower oil at $930 per ton C&F and 18,000 tons of soybean oil at $1050 per ton C&F. In February, 60,250 tons of sunflower oil were purchased at $920 per ton C&F with a 180-day payment term.
Market Trends and Price Movements
According to Trading Economics, between the tenders on May 9 and June 12, the average price of sunflower oil for delivery increased by 10% to $935 per ton. During the same period, July soybean oil futures in Chicago rose by only 2.6% to $965 per ton, highlighting the stronger upward trend in sunflower oil prices.
The rising prices for sunflower oil in the Egyptian tender reflect global trends of increasing demand and tightening supply. Immediate payment terms and the higher number of offers indicate a competitive market. Stakeholders should monitor these trends closely, as they suggest a continued volatility in vegetable oil prices globally.