Rats, drought and labour shortages eat into global edible oil recovery

Watermelon seedlings sprout from freshly ploughed dirt amongst palm saplings at a huge oil palm plantation in the Malaysian state of Perak, while hired cows graze in overgrown sections of the estate.

Even while prices of the world’s most consumed edible oil are reaching record highs, managers of the 2,000-hectare estate in Slim River have been forced to discover inventive ways to maintain their fields due to a coronavirus pandemic-induced labor shortage.

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“It’s simpler to pull your own teeth now than it is to find new workers,” said estate manager Ravi, who would only give his first name. “I can’t seem to get enough laborers to keep the crops in good shape.”

Malaysia, the world’s second-largest producer of palm oil, is experiencing a perfect storm of production challenges, causing global inventories to plummet to their lowest level in five years.

The difficulties faced by producers of various edible oils across numerous continents, from Canadian canola farmers to Ukrainian sunflower growers, as they strive to fulfill increasing demand, are encapsulated in the Southeast Asian country.

This year, global food prices have risen to 10-year highs, with the Food and Agriculture Organization’s (FAO) price index up more than a third since last summer, thanks in large part to a surge in the price of vegetables, which are essential for both food preparation and as fat in a variety of everyday staples.

The FAO’s global edible oils index has risen 91 percent since June and is anticipated to rise much more as economies reopen following the Covid-19 lockdowns, boosting edible oil consumption for food and fuel. However, a slew of obstacles, including labor shortages, heat waves, and vermin infestation, have pushed aggregate stockpiles of the world’s most widely used edible oils – palm, soybean, canola (rapeseed), and sunflowerseed – to their lowest levels in a decade.

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