Alternatives to sunflower oil to push up food prices further

Russia’s invasion of Ukraine has disrupted the supply of almost half of the world’s sunflower oil exports, creating acute shortage and sky-high rates thereby forcing companies to turn to other alternatives such as rapeseed oil and palm oil. However, the situation is now turning out to be a double whammy owing to higher prices and sustainability concerns of such alternatives.

Sunflower oil’s prices are surging and it is set to become more scarce from the summer as Ukrainian farmers may struggle to grow and export the crop. 

Richard Walker from Iceland Foods has said that 450 products of Iceland Foods are affected and while many can use alternatives, such as rapeseed oil, the grocer will have no choice but to “regrettably” use palm oil in about 30 to 40 products.

“Sunflower oil prices have gone up 1,000 percent, but it is less about the price as the oils are often only a small constituent part of the products,” Walker said. “The real challenge is getting your hands on it.”

Companies using sunflower oil for frying have been replacing it with palm oil, soybean oil and rapeseed oil.

While use of palm oil draws sustainability concerns, switching to rapeseed oil is proving to be more expensive and tricky. While rapeseed oil is said to be “twice as expensive”, it often leads to a “fishy” taste as compared with sunflower oil.

Andrew Crook, president of the U.K.’s National Federation of Fish Friers, told Bloomberg that his own shop in Euxton in northwest England has seen prices for 20-litre sunflower oil drums rise to 40 pounds from 30 pounds in the past two weeks. They typically go through eight or nine a week and might have to switch to palm oil at some point, though he values sunflower for its “nice, clean taste.”

Rapeseed oil is seeing the highest increase in demand, according to Hemeline Macret, head of oilseed market analysis at Strategie Grains.

“It’s used for food already and palm oil is not very popular because of its bad image.” Soybean oil isn’t used in many food recipes because it’s often made from genetically modified soy,” reports quoted Macret as saying. 

Fresh concerns are now being raised that higher food prices and the need to search for supplies further afield will water down Europe’s food standards and push companies to opt for ingredients that may be more harmful to the environment such as palm oil and soy.