OFI February 2024

Page 1




Sector under pressure


Robust demand in Rotterdam


IN THIS ISSUE – FEBRUARY 2024 Sunflower oil



Global sunflowerseed and oil production is forecast higher this season but leading producer Ukraine’s growth and exports are still hampered by its ongoing war with Russia, while Houthi attacks on vessels in the Red Sea are increasing the cost of shipping from Europe to Asia

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Storage & Logistics


Company Profile


Robust demand in Rotterdam

2 Photo: Sime Darby

At the heart of the Port of Rotterdam’s position as the leader of vegetable oil shipments in Europe are its various storage terminal operations Biodiesel, HVO & SAF

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Sector under pressure

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Regulations drive demand Biofuel policies and mandates around the world are now affecting all forms of transports, inlcuding the road, maritime and aviation sectors



Ukrainian EU neighbours call for grain import duties

Biofuel News

Future of plantations


Sime Darby Plantation is mechanising, automating and digitalising its operations in a bid to reduce its dependence on manual labour

Renewable News



All eyes on Red Sea

Health applications Oilseeds and vegetable oils have essential functions in human health, and contain many compounds that can also act as nutraceuticals and antioxidants


EU to investigate Chinese biodiesel dumping claim ADM acquisition of glycerine maker complete

Transport News


Suez shipments fall with Houthi attacks

Biotech News


Bayer loses cancer trial, ordered to pay US$2.2bn

Diary of Events


International events listing




World statistical data






All eyes on Red Sea Houthi attacks on vessels plying the Red Sea have caused major disruption to global trade, including oilseed and vegetable oil shipments.

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The Yemen-based Iranian-backed militants have launched missile and drone attacks on merchant ships heading to Israel since the end of November to support Palestinians, following Israel’s Gaza military campaign launched in October. Any ship passing through the Suez Canal, which is the quickest sea route between Asia and Europe, has to travel via the Strait of Bab el-Mandeb and the Red Sea. With 15% of global seaborne trade moving through this area – including 8% of grain trade, 12% of seaborne-traded oil and 8% of LNG – vessels are re-routing via Africa’s Cape of Good Hope, a diversion that can take 10-14 days longer and is more costly. According to data from the World Trade Organization, total grain and oilseed volumes transiting via the Suez Canal fell from 7.2M tonnes in November to 5.9M tonnes in December, (see p14). This was nearly a fifth down on an annual basis and 15% below the three-year average. In the first half of January, grain and oilseed volumes through the Red Sea slipped 0.9M tonnes, down threefold year-on-year and 63% compared to the three-year average for that period. Clarksons Research reported just before Christmas that Suez Canal ship diversions were already having a bigger impact than the ‘Ever Given’ grounding of 2021, with a 43% reduction in overall tonnage volumes in the week beginning 18 December compared to the first half of December. This comes at a time when less grain and oilseeds are being shipped through the Panama Canal due to lower-than-normal water levels at this key waterway (see p16). Meanwhile, world number two palm oil producer and exporter Malaysia has banned all Israel-bound and Israeli-flagged cargo ships from docking at its ports, singling out Israel’s largest shipping firm, ZIM (see p14). “Any developments or escalation over the next month or so will dictate the course of freight markets,” wrote the UK’s Riverside Tanker Chartering in its January report. “First quarter 2024 could potentially be even more complicated than before as owners grapple with congestion and disruptions to their voyage scheduling. Shippers from Asia to Europe and the West are further being tested as rates being offered by owners are two tier – one via Suez with an option via the Cape of Good Hope. Combine these ongoing issues with even longer tonne-mile voyages and a tightness of tonnage supply, and rates will be pushed higher if this trend continues.” Spiking insurance costs could ultimately tip the scales for further diversion towards the Cape of Good Hope. Premiums of 0.1% of a ship’s hull value had risen to 1%, Freight Waves quoted Lloyd’s List as saying on 16 January. Combined with the Suez Canal transit fee, this would overtake the extra fuel cost of re-routing around the Cape of Good Hope. A naval coalition of more than 20 countries was announced by the USA on 18 December to protect commercial shipping from Houthi attacks, with US/UK airstrikes on Houthi positions in Yemen in January. However, will the strikes further escalate regional hostilities, making ship operators even less likely to take a route through a war zone? All eyes are on what will happen next in the Red Sea and the region.


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NEWS TURKEY/UKRAINE: Istanbul-based tanker operator Palmali plans to increase its shipments of Ukrainian sunflower oil and would be ordering 10 more cargo carriers early this year, company chairman Mubariz Mansimov said in a 12 December Reuters report. “We signed an exclusivity agreement with top sunflower and grains trader Potoky for 2024, meaning extra volume,” Mansimov said. “Palmali aims to ship 90% of Ukraine’s sunflower oil exports from the Danube.” The bulk of the company’s shipments from Ukraine – which started shortly after the Russian invasion in 2022 – comprised sunflower oil, the report said. “We now ship about 65%75% of Ukraine’s sunflower oil exports through the Danube, with a minimum monthly loading of 100,000 tonnes,” Mansimov said, estimating Ukraine’s Danube exports at 160,000-170,000 tonnes/month. Palmali said it also planned to start trading operations, mainly to European and Asian markets. The company handled about three-quarters of Turkey’s sunflower oil imports. It also loaded coal and grain from Russia and delivered diesel fuel to Ukraine’s power plants, the report said. Palmali operates about 30 ships, mostly chemical tankers between 2,000-20,000 tonnes. The 10 new vessels – 15,000 tonne mixed cargo carriers – would be able to carry both wet and dry cargo, the report said. According to US Department of Agriculture forecasts, Ukraine will export 5.6M tonnes of sunflower oil in the current 2023/24 season, representing about 40% of global trade.

Ukrainian EU neighbours call for grain import duties

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Five eastern EU countries have asked for import duties to be introduced on Ukrainian grains, claiming these products were affecting their export markets, Reuters reported on 15 January. The farm ministers of Bulgaria, Poland, Hungary, Romania and Slovakia had sent a letter to the European Commission (EC) requesting action. The five countries were among six EU member states that produced more wheat and maize than needed for domestic consumption, which was key for European food safety and strategic sovereignty, the

ministers said. “This is why Brussels needs to introduce measures that protect the markets of member states bordering Ukraine while helping them make use of their full export potential,” the letter signed by the ministers said. “One of these (measures) could be introducing import duties on the most sensitive agricultural products.” Ukraine’s larger farm sizes made the country’s grain exports cheaper and that was pushing EU farmers out of their traditional export markets, the ministers said.

They also called on the EC to investigate if Ukraine’s production guidelines were in line with EU standards, the report said. Grain exports had become a source of tension between Ukraine and its EU neighbours, with Kiev seeking alternative routes to offset slower exports via its Black Sea ports following Russia's invasion in 2022. Last September, Poland, Slovakia and Hungary announced import restrictions on Ukrainian grain and oilseed imports after the EC decided not to extend a temporary ban on imports into Ukraine’s five EU neighbours. Ukraine had responded by making a complaint to the World Trade Organization. ▪ Turkey, Romania and Bulgaria signed an agreement on 11 January to clear mines in the Black Sea to improve shipping safety and protect Ukraine’s export route, World Grain reported. A strengthened route was needed to clear a larger-than-expected harvest, with Ukrainian officials expecting a harvest of 79M tonnes of grain and oilseeds in 2023/24 and an exportable surplus of 50M tonnes.

ADM stocks fall amid investigation Global agribusiness giant ADM’s stock fell sharply following the company’s announcement on 22 January that its chief financial officer, Vikram Luthar, had been placed under administrative leave amid an investigation into accounting practices in its nutrition segment, World Grain wrote. The company’s stock price fell by 24% on 22 January, marking its largest one-day percentage decline since 1929, World Grain reported on 23 January. The stock closed at US$51.69/share, its lowest level since February 2021. Luthar had been placed on administrative leave following a Securities and Exchange Commission “voluntary” request for documents, the report said. ADM’s external legal advisers and board audit committee were looking at accounting practices in its nutrition segment,


including intersegment transactions. “Pending the outcome of the investigation, the board determined that it was advisable to place Mr Luthar on administrative leave," said ADM lead director Terry Crews. "The board will continue to work in close coordination with ADM’s advisers to ... ensure ADM’s processes align with financial governance best practices.” The firm cut its 2023 profit forecast and delayed its fourth-quarter results due to the investigation, World Grain said. Luthar was promoted to CFO in April 2022 and had been with ADM since 2004. Ismael Roig, an executive who was president of both Europe, Middle East and Africa operations and president of animal nutrition at ADM, was named interim CFO.


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Feeding, Fueling & Building a Better World


India extends edible oil import duties The Indian government has extended its lower duty on edible oil imports by another year until March 2025 in a bid to control food inflation, Reuters wrote on 16 January. India’s lower import duties on crude and refined palm, sunflower and soyabean oils had been set to expire in March. “The decision was expected as the government is keen to keep prices in check ahead of elections,” Sandeep Bajoria, CEO of vegetable oil brokerage Sunvin Group, was quoted as saying.

THE NETHERLANDS: Global agribusiness giant Bunge said on 8 December that it had started construction of its new plant in the HoogTij industrial area at the Port of Amsterdam. Scheduled for completion by the end of 2025, the plant would replace the Maasvlakte refinery in Rotterdam, with production at the current Wormerveer location to be moved to the new facility in phases. Bunge said the new facility was an important next step in expanding its European footprint while improving operational flexibility and efficiency. “The new factory will start production in 2026,” Bunge vice president EMEA (Europe, Middle East and Africa) David Vandermeersch said. “We aim for direct energy savings of 40% and a CO² reduction of 90% by 2030.”

India’s palm oil imports rose to their highest level in four months in December as purchases of refined palm olein surged due to competitive prices. While the government aimed to maintain price stability, the long-term duty policy had adverse effects on local oilseed growers, said BV Mehta, executive director of the Solvent Extractors’ Association of India. “The pressure on oilseed prices from cheaper imports effectively discourages [farmers] from planting more”.

New York restricts use of neonicotinoids

NEONICOTINOIDS New York has become the first US state to introduce legislation restricting the use of neonicotinoid pesticides – also known as neonics – in seeds, Bio News wrote on 15 January. Signed in late December 2023 and set to take effect in 2029, the legislation was more of a bureaucratic hurdle than a complete ban on treating seeds with neonicotinoids, Biotechnology Innovation Organization (BIO) senior director of State Government Affairs, Agriculture & Environment Gene Harrington was quoted as saying. However, BIO and other groups representing

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The basic import duty on refined soyabean and sunflower oils was cut to 12.5% from 17.5% in June last year. India’s annual retail inflation increased at its fastest pace in four months in December, driven by a rise in prices of some food items, Reuters wrote. The country met more than two-thirds of its edible oil demand through imports of palm oil mainly from Indonesia, Malaysia and Thailand; and soyabean and sunflower oils from Argentina, Brazil, Russia and Ukraine.

seed producers had been watching New York closely, as other states were considering similar regulations, Bio News wrote. “This is a first-of-its-kind law that would try to restrict the use of neonic-treated seed,” Harrington said. The law would make it illegal to use neonicotinoid-treated seeds for corn, soyabeans or wheat as of 2029 without a waiver, the report said. To continue using neonic-treated seeds after the 2029 planting season, farmers would need to present an evaluation showing their fields were under threat from pests. They would also be required to take integrated pest management training. At the federal level, the Environmental Protection Agency (EPA) was considering introducing regulation, the report said. However, this was likely to take the form of more detailed instructions for use, which would be printed on the label of seed packets, with farmers duty bound to follow the instructions. In the EU, neonicotinoids have been banned from all outdoor use since 2018 due to concerns they were contributing to the decline of pollinating bees. In January 2023, the European Court of Justice also ruled that member state derogations from the ban were not in line with EU law.

Argentine soyabean production to surge by almost 150% Soyabean production in Argentina is forecast to surge by almost 150% in the 2023/24 marketing year due to optimum rainfall during the planting season, according to US Department of Agriculture (USDA) data reported by World Grain. The USDA’s Foreign Agricultural Service report forecast Argentina’s output at 50.5M tonnes this season, compared with 20.5M in 2022/23, a year when drought 6

cut yields and reduced planted area. This year’s crushing total was also expected to surge to 40M tonnes from some 26M tonnes in 2022/23, the 15 January report said. The El Niño weather pattern had ended the country’s worst drought in more than 60 years, the USDA said. “Higher-than-average rainfall came to much of the major growing areas beginning in early November


and continuing through December.” The USDA increased its soyabean planted area projection by 800,000ha to 17.2Mha due to improved weather and “potential economic policy changes by the new government that will encourage exports”. It estimated Argentine 2023/24 soyabean exports at 6M tonnes, more than three times higher than the amount shipped the previous year. www.ofimagazine.com

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The rate of childhood and adult obesity in Europe and Central Asia has risen, according to a Food and Agriculture Organization (FAO) report. In 2022, the prevalence of overweight children under five years of age in Europe and Central Asia was 7.1%, higher than the global estimate of 5.7%, the 2023 edition of the FAO’s 'Regional Overview of Food Security and Nutrition in Europe and Central Asia' said. Despite a decline from 9.7% in 2010, the prevalence was more than double the 2030 target of reducing childhood obesity, the report said. In 2022, only Central Asia was slightly below the global estimate. At 10.3% – close to double the global estimate – the Western Balkans had the highest rate in the region. The Caucasus had the second-highest rate of overweight children under five years of age (9.1%) in 2022. The data showed a lower rate from 2000 to 2022 in the Caucasus, Central Asia, CIS Europe and Ukraine, and the Western Balkans. In the Central Asia and CIS Europe and Ukraine sub-regions, the prevalence had halved since 2000. In the same period, the rate had increased in the European Free Trade Association countries –

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FAO reports increase in adult, childhood obesity

Iceland, Liechtenstein, Norway and Switzerland – and in EU states and the UK, the report said. Adult obesity had also increased in all sub-regions and all countries in Europe and Central Asia. A comparison between 2000 and 2016 showed an increase in the rate of adult obesity in all 52 countries for which data was available. During that period, Albania and almost all countries in Central Asia had the largest increases (over 60%) in the region.

Indonesia changes CPO reference price The Indonesian government has raised the crude palm oil (CPO) reference price for February to US$806.40/tonne from the previous US$774.93/tonne, AgriCensus reported the trade ministry as saying in a circular. Based on the current export tax structure, the increase effectively raised the payable export levy and duty for CPO by one tier to US$85/tonne and US$33/tonne from the previous levels of US$75/tonne and US$18/ tonne, the 31 January report said. With export taxes on other palm oil products also increased, Indonesian palm oil exports were now more expensive, AgriCensus wrote. As reported by Fastmarkets in the week before the announcement, the new reference

price would apply for the whole of February instead of half the month, as previously, and followed earlier government proposals to change the frequency of CPO reference price revisions from bi-weekly to once a month. The change also aligned Indonesia’s CPO reference price revision frequency with Malaysia, which had earlier set its reference price for February at MYR3571.39/tonne (US$755/ tonne), with the corresponding export tax for CPO at MYR285.71/tonne (US$60.42/tonne). Indonesia’s formula for the reference price calculation currently used a combination of CPO prices from Bursa Malaysia, ICDX and Rotterdam, but the government was considering removing Rotterdam prices, AgriCensus wrote.

IN BRIEF WORLD: The global rapeseed planted area is expected to decline this year with a significant reduction forecast in Ukraine, according to International Grain Council (IGC) forecasts reported by Germany’s Union for the Promotion of Plants and Protein (UFOP). High global rapeseed stocks led to a sharp drop in prices and futures market quotations in the past year, leading the IGC to forecast a decline in world rapeseed planted area in 2024/25. The estimated 1.5% yearon-year drop in rapeseed planted area to 42.4M ha still exceeded the long-term average, the 18 January report said. IGC estimates the EU rapeseed area to decrease by 2.7% to 6M ha and Ukraine's to fall 22.5% on the current crop area to some 1.6M ha. Russia’s rapeseed planted area was expected to be 2M ha in 2024, 8.2% lower than the previous year. THAILAND: Louis Dreyfus Co (LDC) announced a Memorandum of Understanding on 19 January with Bangkok Produce Merchandising (BKP) – a subsidiary of Charoen Pokphand Foods (CPF) – to collaborate on sustainable and deforestation-free supply chains soya products sourced by LDC in Brazil destined for countries in Asia, where BKP and CPF produce and sell feed and food.

Brazilian soya export prices fall amid weak Chinese demand Brazilian soyabean export prices fell in mid-January due to weak Chinese demand, the start of the harvest season and other local factors, AgriCensus wrote on 15 January. Soyabean prices dropped more than 60c/ bushel (bu) in the week before the report. Trade sources reported offers of Brazilian cargoes for February shipment were at a premium of 85-95c/bu on the day of the report and at 85c/bu the previous Friday, www.ofimagazine.com

compared with 140-145c/bu over March CME futures CFR China the previous week. The start of the soyabean harvest was a major factor driving prices lower in Brazil as Chinese buyers would be aware that storage capacity in producing countries would be under pressure, according to Ranieri Pasinato Junior, a market analyst for Zairam Agrocomm Brokerage. “Some other elements are also at play including South

America's huge soya production; lower Chinese demand amid poor crush margins and sufficient stocks; and more competitive pricing of Argentinian soyabeans,” he said. A substantial production forecast in Brazil was a further factor, AgriCensus wrote. Potential logistical difficulties in Paranaguá – where a large volume of old crop awaited shipment – could also have pushed prices down, Brazil-based sources added. OFI – FEBRUARY 2024


NEWS BRAZIL: Global agribusiness giant ADM has expanded its regenerative agriculture programme with the launch of a scheme in Brazil for soyabean farmers. Involving 20 soyabean farmers, the pilot programme would cover 20,000ha in Minas Gerais (Uberlândia region) and Mato Grosso do Sul (Campo Grande region), the company said on 21 November. ADM said farmers participating in the pilot would receive technical assistance, training sessions and soil organic matter and carbon sequestration measurements. The initial focus would be on three practices: fertiliser use efficiency and increased use of biological inputs; no till farming and covered soil/ cover crops. ADM said it aimed to cover 120,000 ha in Brazil by 2027 and 1.61M ha globally by 2025. AMERICAS: International agribusiness Louis Dreyfus Company (LDC) is working in partnership with global conservation organisation The Nature Conservancy to promote regenerative agriculture and deforestation-free (DCF) production. The collaboration would prioritise on-the-ground projects in grains, oilseeds, coffee and cotton value chains in North and South America, encouraging practices that improved soil health, restored aquifers, promoted biodiversity and mitigated climate change, LDC said on 12 January. LDC’s regenerative agriculture plan targets a minimum of approximately 1.2M ha by 2030 and would involve around 30,000 farmers in selected commodity supply chains, it said.

Eliminating trans fat shows great progress, says WHO Great progress has been made in the global elimination of industrially-produced trans fats, with nearly half the world’s population protected against the harmful effects of the product, VOA News quoted the World Health Organization (WHO) as saying. “Five years ago, WHO called on countries and the food sector to eliminate industrially-produced trans fats from the food supply. The response has been incredible,” WHO director-general Tedros Adhanom Ghebreyesus was quoted as saying in the 29 January report. “So far, 53 countries have implemented best practice policies, including bans and limits on trans fats, with three more countries on the way. This removes a major health risk for at least 3.7bn people, or 46% of the world’s population.” These policies were expected to save 183,000 lives every year, he said. “Just five years ago, only 6% of the world’s population was protected from trans fats with similar policies,” Ghebreyesus added. Industrially-produced trans fats are formed during partial hydrogenation of vegetable oil to produce solid fats, which are more stable and

have a longer shelf life than liquid oils. They can be found in margarine, fried foods, baked products, pastries and some processed foods. Ghebreyesus said the next two years would be critical, noting that the original deadline for the global elimination of trans fats had been extended from 2023 to 2025 due to the disruptions caused by the COVID-19 pandemic. A high intake of trans fat increases the risk of death from any cause by 34%, and from coronary heart disease by 28%, according to the WHO. To date, five countries – Denmark, Lithuania, Poland, Saudi Arabia and Thailand – had eliminated trans fat from their food supply, VOA News wrote. “Of the remaining [countries], just five – China, Pakistan, Russia, Indonesia and Iran – account for about 60% of the remaining estimated burden. If these five countries were to implement [best practice policies], the world would get to about 85% of the estimated burden,” Tom Frieden, president and CEO of Resolve to Save Lives said. According to the WHO, progress remains uneven, with Africa having the lowest policy coverage but South Africa beginning enforcement.

COFCO signs deforestation-free soya deal

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Global agribusiness COFCO International and COFCO Group’s China Sheng Mu Organic Dairy Co – the largest organic dairy company in China – have signed an agreement to supply deforestation and conversion-free soyabeans from Brazil to Sheng


Mu in China. Signed by the companies on 15 January, the deal was for 12,000/year tonnes of soyabeans initially, with volumes to be gradually increased, COFCO International said. The company said it would undertake third-party verifica-

tion for the supply. The announcement followed another agreement signed by COFCO International and Modern Farming Group in November to supply and accept soyabeans coming from sustainable areas of production in Brazil. According to a statement from the World Economic Forum's Tropical Forest Alliance at the time, the US$30M deal marked the first soyabean order in China under a "clear deforestation- and conversion-free (DCF) clause." Active in grains, oilseeds, sugar and cotton with assets in 37 countries across the Americas, Europe and Asia-Pacific, COFCO International is the overseas agriculture business arm of China’s largest food and agriculture firm, COFCO Corp. www.ofimagazine.com

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BIOFUEL NEWS UAE: Global commodity exchange ACX announced on 28 November that it had launched a physical biofuels trading platform in Abu Dhabi – called ACXBiofuels – that would cover trading in fatty acid methyl esters (FAME), rapeseed methyl ester (RME), used cooking oil methyl ester (UCOME), hydrotreated vegetable oil (HVO), palm oil methyl ester (PME) and sustainable aviation fuel (SAF). The company was also launching a global contract for key feedstocks including used cooking oil (UCO) and palm oil mill effluent (POME). “ACX’s range of biofuels products are expected to boost price transparency and awareness of biofuels pricing worldwide, as all participants trading in ACX’s market will also be certified under the International Sustainability & Carbon Certification program (ISCC),” ACX co-CEO William Pazos said. All the contracts were aligned to customary physical contracts that were already traded in the market. “Some of the contracts, particularly FOB Northwest Europe, will be aligned to existing window-trade products, enabling a natural arbitrage,” said Henri-Jean Bardon, director of the biofuels platform at ACX.

EU to investigate Chinese biodiesel dumping claim The European Commission (EC) has said it would begin an investigation into allegations that biodiesel imports from China are coming into the region at artificially low prices, Reuters reports. “EU producers claim these imports are seriously harming their industry because they cannot compete with such low prices,” the EC was quoted as saying in a statement. The investigation had been prompted by a complaint filed by the European Biodiesel Board (EBB) and would take up to 14 months – with the possibility of provisional duties being imposed within eight months – and would cover the period from 1 October 2022 to 30 September 2023, the 20 December Reuters report said. Last August, the EU also started an investigation into allegations that biodiesel from In-

donesia was circumventing EU duties by going through China and Britain. China had been the biggest biodiesel exporter to the 27-member bloc in 2023, the EBB said in a separate statement. “In 2023, Chinese dumped imports caused a collapse in the market and production sites closed in several member states,” the EBB added. In addition to the possible transit of Indonesian biodiesel, the association said there were structural imbalances in biodiesel trade with China, with prices not reflecting the advanced or waste-based biofuel categories that most shipments had been classified as. According to the EC, the EU’s biodiesel sector is worth US$34bn (€31bn)/year.

WTO to review EU duties on Indonesia

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The World Trade Organization (WHO)’s Dispute Settlement Body (DSB) has agreed to a request submitted by Indonesia to review the European Union (EU)’s countervailing duties on Indonesian biodiesel imports, Biodiesel magazine reported on 29 November.

Following a request by the European Biodiesel Board on 4 July, the EU opened an investigation in August into whether Indonesia had circumvented UE countervailing duties on imports of biodiesel originating in the country by routing the fuel through China and the UK, the report said. Indonesia had submitted two requests seeking the establishment of a panel to determine whether the countervailing duties were in line with WTO rules, Biodiesel magazine wrote. According to the WTO website, after the EU said it was not in a position to agree to Indonesia’s first request at a DSB meeting on 26 October, Indonesia repeated its right to protect its national interests. The DSB had now agreed to establish the panel, the report said.

Brazil to speed up pace of biodiesel mandate rise Brazil’s national energy policy council (CNPE) will speed up the country’s biodiesel mandate rise, with a 14% blend (B14) to be introduced from March, AgriCensus reported the country’s Minister of Mines and Energy Alexandre Silveira as saying. The official schedule had previously indicated that the current B12 blending mandate would increase to 13% in March, the 19 December report said. CNPE also proposed a rise to B15 by March 2025, above the B14 blend originally projected.

In addition, the council approved the temporary suspension of biodiesel imports, reversing the decision by the National Agency of Petroleum, Natural Gas and Biofuels (ANP) on 23 November to allow biodiesel imports. Brazilian vegetable oils association Abiove welcomed the decision to suspend biodiesel imports “at a time when the industry is trying to recover from a difficult scenario, with around 50% of capacity idle”. Soyabean oil comprises about 70% of

10 OFI – FEBRUARY 2024

the feedstock used to produce biodiesel in Brazil, with industry sources estimating that each percentage point increase in the biodiesel mandate represented an additional demand of more than 400,000 tonnes/ year of soyabean oil, AgriCensus wrote. According to Abiove estimates published on 12 December, Brazil’s 2023/24 soyabean crush was forecast at 54.5M tonnes with soyabean oil and soyabean meal output at 11M tonnes and 41.7M tonnes, respectively. www.ofimagazine.com

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ADM acquisition of glycerine maker complete Global agribusiness giant ADM has completed its acquisition of a controlling stake in Brazilian glycerine producer Buckminster Química. “The [acquisition of] Buckminster Química – which has already been a partner for our Brazilian business – is another way in which we’re broadening our portfolio and expanding our capabilities to meet growing customer needs for sustainably-sourced products spanning food,

THE NETHERLANDS: Dutch food company Upfield has launched a plastic-free, recyclable tub for its plant butters and spreads as part of its aim to reduce plastic content across its portfolio by 80% by 2030. Initially introduced in Austria for Flora Plant butter at the end of last year, Upfield said on 9 January that it expected to scale up use of the tub and aimed to replace up to 2bn plastic tubs by 2030, avoiding more than 25,000 tonnes/year of plastic waste. The tubs are produced from compressed wet paper fibres and are waterproof, oil-proof and recyclable in local paper waste streams. FINLAND: Renewable fuels producer Neste’s crude oil refinery in Porvoo is set to be converted into a renewables and circular solutions refining hub, with a targeted completion in the mid2030s, the company said on 20 December. Following completion of the conversion, Neste said it expected the long-term capacity potential to be around 3M tonnes/year of renewable and circular products, such as renewable diesel, sustainable aviation fuel and feedstocks for the polymers and chemicals industry.

In addition to its acquisition of Buckminster Química, ADM also announced that it was expanding its crush capacity at three oilseed processing facilities in Campo Grande, Mato Grosso do Sul; Porto Franco, Maranhão; and Uberlandia, Minas Gerais. The investments were expected to add some 400,000 tonnes/year to ADM’s crushing capacity in Brazil, the company said.

Holiferm to scale up its biosurfactants

Photo: Holiferm


feed, fuel, industrial and consumer products,” ADM’s director of oils and biodiesel in Brazil Luiz Noto said on 5 December. Founded in 1999, privately-owned Buckminster Química produces refined glycerine from soyabeans at its single manufacturing facility in Macatuba, São Paulo. The company’s glycerine is used in the pharmaceutical industry, the food sector and the kosher market.

UK biotech start-up Holiferm plans to scale up its production of biosurfactants after securing US$23.36M in investments. The company’s fermentation production process uses rapeseed oil and glucose as

raw materials. Using natural yeast fermentation with integrated gravity separation technology, Holiferm produces low- and high-foaming sophorolipids for surfactant applications including the production of personal care, home care

and cosmetic products. The new funding from Rhapsody Venture Partners and Clean Growth Fund would allow the company to install new fermenters at its Wallasey plant in Liverpool and increase production from 1,100 tonnes/ year to 3,500 tonnes/year by the end of the year, and then upscale to 15,000 tonnes/year, Holiferm said on 11 December. The investment would enable full market launches by major multinational customers. It would also help boost work being conducted at Holiferm’s research and development facility in Manchester, while helping the company refine manufacturing methods for other biosurfactants, the firm said.

First industrial biosurfactant batch from Evonik Speciality chemical company Evonik has manufactured its first batch of biosurfactants from its industrial-scale plant in Slovakia, ahead of schedule. Evonik produces its range of rhamnolipid biosurfactants at the plant in Slovenská Ľupča from corn sugar using a fermentation-based manufacturing process. The biogenic, carbon-based process did not require petrochemical feedstocks or tropical oils, Evonik said on 18 January. Evonik is active in more than 100 countries and its Nutrition & Care division develops products for active pharmaceutical ingredients, medical devices, nutrition for humans and animals, personal care, cosmetics and household cleaning. Located in Slovenská Ľupča, Evonik Fermas was founded in 1992 as a joint venture between

12 OFI – FEBRUARY 2024

Degussa AG and Biotika. The company initially produced amino acids for animal feed using biotechnology, but in 1998, became a 100% subsidiary of Evonik, expanding to include the production of fermentation-based products for animal nutrition, pharmaceuticals, cosmetics and personal care. In 2016, Evonik Fermas ran the first pilot plant for the production of biosurfactants via fermentation. Rhamnolipids are a class of biosurfactants which are manufactured via fermentation, with their foam-forming properties making them suitable for use in household cleaners and personal care products. They are also suitable for use in industrial applications such as coatings, mining, and oil and gas. www.ofimagazine.com

SOLUTIONS FOR SUSTAINABILITY, PROCESSING & TRADE 9-11 September 2024, Rotterdam, the Netherlands www.ofimagazine.com/ofievent

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Suez shipments fall with Houthi attacks ● Suez Canal

Photo: Adobe Stock

Grain and oilseed shipments transported via the Suez Canal in December fell 20% compared to the previous month, World Grain reported an International Grains Council (IGC) analyst as saying. Citing private, real-time shipping data, IGC senior economist Alexander Karavaytsev said volumes were well below the same month in 2022 and the three-year average. The drop in shipments was due to ongoing drone and missile attacks on shipping vessels in the Red Sea by Yemen-based Houthi rebels, which had started to significantly impact dry bulk shipments, including grain, after being mainly limited to the container segment during the first stages of the crisis, the 25 January report said. The Houthis have been attacking vessels in the Red Sea since late October, shortly after Hamas’ attack on Israel, which provoked an Israeli counterattack on the Gaza Strip, where Hamas is based. The Houthis say their attacks are in response to Israel’s counteroffensive.

Several of the world’s largest shipping firms (including Maersk and Hapag-Lloyd) had suspended shipping through the Suez Canal –which handled about 12% of global trade – and were re-routing around the Cape of Good Hope at the southern tip of Africa, World Grain wrote. According to IGC estimates, re-routing from the EU and the Black Sea countries via the Cape of Good Hope “adds around 10 to 15 days to the journey time and around US$6US$8/tonne to freight costs.” Additional costs were linked to marine fuel prices, which ac-

CHS Broaden to build grain export terminal in Australia

Grain and oilseed supply chain company CHS Broadbent is planning to develop a new 80,000 tonne bulk grain export terminal in Geelong, Victoria, Australia. Featuring road and rail unloading facilities, the company said it expected construction on the 5ha site to begin this year. “The terminal will be designed with an annual export capacity of 1.5M tonnes,” CHS Broadbent managing director Steve Broadbent said on 27 November. CHS Broadbent owns and operates grain and oilseed storage, container packing and freight operations in Queensland, New South Wales and Victoria. It handles and exports canola, wheat, oats, barley, oats, pulses and sorghum. In 2019, CHS Broadbent joined the Central Office for Sustainable Canola, to ensure farmers delivering their canola to its storage and handling facilities could deliver canola seed to international markets, including the EU biodiesel industry. The company is 50% owned by the Broadbent family, with the remaining share owned by global agribusiness CHS Inc. 14 OFI – FEBRUARY 2024

counted for some 20% of total voyage expenses, Karavaytsev said. With reports of rising demand for marine fuel at ports around Africa, the resulting increase in fuel prices “could push importers in Asia and parts of Africa to look for alternatives offering shorter delivery times and also exert downward pressure on fob prices in the EU, Russia and Ukraine,” he added. According to Word Trade Organization data reported by Anadolu news agency on 19 January, total grain and oilseeds volumes transiting the Suez Canal dropped from 7.2M tonnes in November 2023 to

5.9M tonnes in December. This was nearly a fifth lower on an annual basis and 15% below the three-year average. In the first half of January, grain and oilseeds volumes through the Red Sea were 0.9M tonnes lower, down three-fold year-on-year and 63% compared to the threeyear average for that period. According to analysis by international affairs think tank Chatham House, 14% of the world’s grain and less than 5% of its soyabeans pass through the Suez Canal each year. The USA announced a naval coalition to protect commercial shipping on 18 December, with joint US/UK air strikes on Houthi positions in Yemen carried out in mid-January. ▪ Anwar Ibrahim, the prime minister of global number two palm oil producer Malaysia, announced on 20 December that the country had banned all Israeli-flagged and Israel-bound cargo ships from docking at its ports, saying Israel had violated international law, Aljazeera reported.

ADM Canadian terminal receives $26.3M funding Global agribusiness giant ADM has received funding of US$26.3M under Canada’s National Trade Corridors Fund for the expansion of its grain terminal at Port Windsor, World Grain wrote on 12 January. The project would increase export capacity to markets in Europe, Latin America and the USA for agricultural production from southwestern Ontario farmers in Essex, Kent, Lambton, Middlesex and Elgin counties, the report said. “The investment being made by the government of Canada for the ADM grain terminal expansion project at Port Windsor will allow ADM to maintain and grow our operations,” Kevin Wright, general manager, Great Lakes region, ADM Agri-industries, was quoted as saying. The project would involve improvements to the terminal’s infrastructure and export loading capacity, Wright added. ADM has 369 grain storage facilities in the USA and Canada with 434.34M bushels of licensed grain storage, making it the largest grain handling and storage company in North America as listed in Sosland Publishing Co’s 2024 Grain and Milling Annual.


SOLUTIONS FOR SUSTAINABILITY, PROCESSING & TRADE 9-11 September 2024, Rotterdam, the Netherlands www.ofimagazine.com/ofievent

TRANSPORT NEWS THE NETHERLANDS: Rotterdam’s B20-VLSFO and B30-VLSFO bunker prices increased significantly at the start of January following the Dutch government’s halving of the rebate multiplier for marine biofuel sales from 0.80 to 0.40, Bunkerspot reported from data by marine fuel intelligence platform ENGINE. Under the new policy which came into effect on 1 January, suppliers would now get around US$50/ tonne for advanced B20VLSFO (20% biofuel, 80% VLSFO) sold and US$80/ tonne for advanced B30VLSFO, the 4 January report said. Prior to the policy change, advanced B20 and B30 rebates were around US$100/tonne and US$160/tonne respectively, while the outright price for advanced B30-VLSFO had now risen by more than US$70/tonne to above US$700/tonne, according to ENGINE. CANADA: Canadian National Railway (CN) has acquired Iowa National Railway (IANR). The acquisition would support the growth of local business by creating a single-line service to North American destinations, while preserving access to existing carrier options, CN said on 6 December. Serving upper midwest agricultural and industrial markets and transporting a range of goods, including biofuels and grain, IANR operates around 442km (275 miles) in Iowa connecting to CN’s US rail network. The terms of the acquisition were not disclosed and CN said a decision regarding the transaction was expected from the Surface Transportation Board this year.

Less dry bulk cargo leads to fall in Panama transits Transits via the Panama Canal fell by 4.3% in March compared to the previous month driven by a decline in dry bulk shipping, according to data published by the Panama Canal Authority (ACP) reported by Freight Waves wrote on 19 January. However, the pace of decline had slowed, with the ACP increasing its transit slots to 24/day, effective 16 January, overriding a previous 18/day advisory introduced to deal with low water levels caused by ongoing drought. The drought had left Panama’s Gatun Lake at six feet below expected water levels needed to operate the canal’s locks. Better than expected weather conditions in November had led the ACP to increase its slots but the allowance was still below the 36 ships/day normally travelling through the vital global waterway, Ship Technology wrote on 18 December. International Grains Council senior economist Alexander Karavaytsev said he expected the lower-than-normal volume of grain shipments through the Panama Canal “to persist at least through February. “The impact of Panama restrictions has been most evident for grains and oilseeds exports from the US Gulf, with some shipments diverted to alternative routes, including the Suez Canal,” he

said. “This was the case for US soyabeans, with volumes via the Suez spiking in recent months.” In the second half of October, only five US Gulf grain vessels heading to Asia transited via Panama, while 33 detoured to use the Suez Canal, according to a US Department of Agriculture report. However, Houthi attacks on vessels in the Red Sea leading to the Suez Canal are now causing concern over this route. Other options included sailing south around South America or Africa but these longer routes could add up to two weeks to shipping schedules, increasing costs for fuel, crews and freight leases, Reuters wrote earlier on 11 December. Grain was second only to petroleum among commodities that relied on the Panama Canal, World Grain wrote on 25 January. In 2022, ships carrying 36.18M tonnes of grain – including corn, soyabeans, rice, sorghum, barley and wheat – transited the Panama Canal from the Atlantic Ocean to the Pacific Ocean while 2.2M tonnes was shipped from the Pacific to the Atlantic. The waterway handled some US$270bn/year worth of global trade, 3% of global maritime trade volumes and 46% of containers moving from Northeast Asia to the US East Coast under normal circumstances, Bloomberg wrote on 2 January.

Constanta port reports record volumes

Photo: Adobe Stock


Romania’s Port of Constanta reported a 50% year-on-year increase in grain exports last year due to a surge in shipments from Ukraine and ongoing EU-funded infrastructure projects, Reuters reported the port authority as saying. Located on the Black Sea, the port exported 36M tonnes of grain in 2023 with Ukraine ac-

16 OFI – FEBRUARY 2024

counting for 14M tonnes, the authority said. Constanta had become Ukraine’s largest alternative export route since Russia’s invasion in February 2022, with grains arriving by road, rail and barge across the Danube, Reuters wrote. However, transit volumes had fallen since last July when Russia repeatedly targeted Ukraine’s river ports, the 10 January report said. The Romanian government planned to increase export capacity for Ukrainian grain to 4M tonnes/month and was upgrading rail and road infrastructure in and around the port. Romanian Transport Minister Sorin Grindeanu was quoted as saying in December that an EU-funded project to enable round-the-clock navigation on the Danube river’s Sulina canal, which goes to Constanta, had been finalised and would become operational pending staff training. The overall traffic of goods in Constanta totalled 92.5M tonnes in 2023, a 22.5% increase compared to the previous year, the port authority said. www.ofimagazine.com

SOLUTIONS FOR SUSTAINABILITY, PROCESSING & TRADE 9-11 September 2024, Rotterdam, the Netherlands www.ofimagazine.com/ofievent


Bayer loses cancer trial, ordered to pay $2.2bn To date, around 165,000 claims had been made against Bayer for personal injuries allegedly caused by Roundup, which the firm took over as part of its US$63bn acquisition of US agrochemical company Monsanto in 2018. Bayer had settled most Roundup cases against it in 2020 for up to US$9.6bn but had been unsuccessful in reaching a settlement covering future cases and more than 50,000 claims remained pending, Reuters wrote on 23 December. Glyphosate is the most widely used herbicide in agriculture and most genetically modified crops are designed to tolerate Roundup, allowing spraying against weeds during the growing season without destroying the crop.

A Pennsylvania jury has ordered German chemical giant Bayer’s Monsanto unit to pay more than US$2.2bn to a former Roundup user who claimed his cancer was caused by the weedkiller, Bloomberg reported on 26 January. The settlement was the highest payout to date in five years of litigation involving the herbicide. Jurors in a Philadelphia state court awarded John McKivison US$250M to compensate for his losses and US$2bn in punitive damages over his claim that years of using Roundup at work and at home had caused his cancer, the report said. The 49-year-old was exposed to Roundup while working as a landscaper.

Photo: Adobe Stock

EU committee backs easing of GM rules

The EU’s environmental committee has backed proposals to relax rules on genetically modified (GM) plants produced using new genomic techniques (NGTs), AP News reported on 24 January. The Environment, Public Health and Food Safety committee adopted its position on a European Commission proposal on 24 January. The European Parliament was expected to vote on the proposed law in February before it could start negotiations with EU member states

to adopt it, AP News wrote. The current legislation gives environmentalists the assurance that the EU will not allow multinational food companies to produce GM products in bulk without detailed labelling and warnings, according to the report. EU lawmakers had agreed to create two different categories and two sets of rules for GM plants produced using NGTs. Those considered equivalent to traditional crops would be exempt from GM legislation, but other NGT plants would be required to follow current rules. The committee agreed that all NGT plants should remain banned in organic production. It also agreed on a ban on all patents filed for NGT plants, saying it would help “avoid legal uncertainties, increased costs and new dependencies for farmers and breeders”. Greenpeace said that, if adopted, the new law did not provide sufficient protection against the contamination of crops with new genetically modified organisms (GMOs).

IN BRIEF PAKISTAN: Amendments to Pakistan’s biosafety guidelines will allow imports of genetically engineered (GE) soyabean and canola to resume, according to the US Department of Agriculture (USDA) Foreign Agricultural Service (FAS)’s 4 December ‘Pakistan: Oilseeds and Products Update’. The Federal Cabinet approved amendments to the Pakistan Biosafety Rules on 24 November, the report said. Although further clarification was still needed from the country’s Ministry of Climate Change on how the import licensing system would be implemented, the USDA said the new guidelines could be introduced in the first quarter of 2024. “The amendments should enable importers to eventually obtain an import licence for GE commodities destined for food, feed and processing,” the USDA said. Following the move, the USDA increased its forecast for Pakistan’s 2023/24 soyabean imports from 0.5M tonnes to 1M tonnes while no changes were made to rapeseed/canola supply and demand estimates. GE soyabean and canola imports had been blocked in Pakistan since October 2022. At 950,000 tonnes, rapeseed was Pakistan’s most imported oilseed in 2022/23, with Australia holding a 60% market share.

China issues licences for GM corn and soya seeds China’s Ministry of Agriculture and Rural Affairs has issued licences to 26 domestic seed companies to produce, distribute and sell genetically modified (GM) corn and soyabean seeds in selected provinces, Reuters reported on 28 December. The domestic companies included Beijing Dabeinong Technology Group and China National Seed, now owned by Syngenta Group. Other licensed firms included those operating in the major grain-producing provinces of Hebei, Liaoning, Jilin and Inner Mongolia. www.ofimagazine.com

This was China’s first batch of companies to receive seed production and operation licences for GM corn and soyabeans, the GLOCON Agritech Co-Innovation Institute was quoted as saying in a note, paving the way for commercial planting of the crops. The move was part of China’s ongoing efforts to reduce its reliance on imports, the report said. With Chinese imports of soyabeans and corn totalling approximately 100M tonnes/ year and as the world’s leading buyer of both commodities – mainly from Brazil and

the USA – improved yields from GM corn and soyabeans could help reduce those imports, World Grain wrote. China is expected to tightly control the roll-out of GM crops, according to the report. Large-scale trials of GM soyabeans and corn were carried out last year, which the agriculture ministry was quoted as saying had shown “outstanding” results. Chinese corn producers were preparing to plant about 670,000ha of GM corn in eight provinces this year, more than double the area planted in 2023, Reuters said. OFI – FEBRUARY 2024


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DIARY OF EVENTS 27-28 February 2024

9-10 May 2024

12-15 June 2024

Black Sea Grain Europe Corinthia Hotel, Prague Czech Republic https://ukragroconsult.com/en/ conference/black-sea-grain-2024

14th ICIS World Surfactants Conference Hyatt Regency, Jersey City, USA https://events.icis.com/website/8544/

22nd EFPRA Congress Amsterdam, the Netherlands https://efpra.eu/events

4-6 March 2024 POC2024 Shangri-La Hotel, Kuala Lumpur Malaysia www.pocmalaysia.com 8-9 April 2024 Aquafeed Europe 2024 Technical Short Course (+ Online) Novotel Gent Centrum, Belgium www.smartshortcourses.com 17-18 April 2024 European Algae Industry Summit London, UK www.wplgroup.com/aci/wp-content/ uploads/sites/2/2023/08/EuropeanAlgae-Industry-Summit-Agenda.pdf 18 April 2024 Black Sea Grain Kyiv Intercontinental Hotel, Kyiv Ukraine https://ukragroconsult.com/en/black-seagrain-kyiv 25-27 April 2024 Oils & Fats Expo Bangladesh 2024 International Convention City Bashundhara (ICCB), Kuril, Dhaka Bangladesh www.oilfatbd.com/ 28 April-1 May 2024 2024 AOCS Annual Meeting & Expo + Sustainable Protein Forum Montréal, Québec, Canada www.aocs.org/attend-meeting 6-8 May 2024 Globoil International 2024 Hyatt Regency, Dubai, UAE https://www.globoilinternational.com/ 7-8 May 2024 Oleochemical Technical and Market Approach Course Louvain-la-Neuve, Belgium https://drive.google.com/file/d/1xB7udyUtPmrG8dQJ2YozUWZEa6LkqOp/view 18 OFI – FEBRUARY 2024

20 May 2024

8-10 July 2024

Malaysian Palm Oil Forum, Egypt Cairo, Egypt https://mpoc.org.my/mmd-programmecalendar-2024

International Symposium on Lipid Oxidation and Fatty Acids Bologna, Italy https://eurofedlipid.org/5th-internationalsymposium-on-lipid-oxidation-andantioxidants

21-23 May Sustainable Aviation Futures Congress Hotel Okura Amsterdam, the Netherlands www.safcongress.com 23 May 2024 Malaysian Palm Oil Forum, Turkey Istanbul, Turkey https://mpoc.org.my/mmd-programmecalendar-2024/ 4-5 June 2024 31st Practical Short Course: Advanced Oil Processing: Palm, Palm Kernel and Coconut Oil Processing & Food Applications Bogotá, Colombia www.smartshortcourses.com/ oilprocess31/index.html 4-7 June 2024 Annual Vegetable Oil Extraction Short Course College Station, Texas, USA https://fatsandoilsrnd.com/annualcourses 11-12 June 2024 International Grains Conference London, UK www.igc.int/en/conference/confhome. aspx

9-11 September 2024 OFI International 2024 Rotterdam Ahoy Convention Centre, the Netherlands www.ofimagazine.com/ofievent 16-17 September 2024 6th International Symposium on Dietary Fat and Health Frankfurt, Germany www.dgfett.de/meetings/aktuell 2-4 October 2024 Sustainable Aviation Futures North America Congress Marriott Marquis, Houston, Texas, USA www.safcongressna.com 22-23 October 2024 Oil and Fats International Congress (OFIC) 2024 (+ Online) Kuala Lumpur Convention Center, Malaysia https://mosta.org.my/events/ofic-2024 22-26 October 2024 2024 North American Renderers Association Annual Convention Ritz Carlton Bacara Santa Barbara, California, USA https://nara.org/about-us/events

12-13 June 2024

4-6 November 2024

Oleofuels 2024 Summit Milan, Italy www.wplgroup.com/aci/event/oleofuels

Sustainable Aviation Futures APAC Congress Singapore www.safcongressapac.com

12-13 June 2024 Black Sea & Danube Way For Grain Bucharest & Constanta, Romania https://ukragroconsult.com/en/black-seadanube-way-for-grain/

7-9 November 2024 5th YABITED Fats and Oils Congress Antalya, Turkey www.yabited2024.com/EN/Default.aspx

For a full events list, visit: www.ofimagazine.com Information subject to change www.ofimagazine.com

STORAGE & LOGISTICS At the heart of the Port of Rotterdam’s position as the leader of vegetable oil shipments in Europe are its various storage terminal operators Ile Kauppila The Port of Rotterdam in the Netherlands is Europe’s largest seaport and the region’s market leader in vegetable oil shipments. Contributing to the port’s prime position as a vegetable oils and animal fats shipping hub are its excellent connections over sea and land and the presence of major vegetable oil and biofuel refiners. At the heart of this bustling trade are the various storage terminal operators that call the Port of Rotterdam home. In total, the Port of Rotterdam says it has 31M m3 of liquid bulk storage capacity. Of that total, 1.2M m3 are currently available for vegetable oil with the port’s storage terminal operators constantly expanding and improving their facilities in response to rising demand, particularly in the biofuels sector. The largest vegetable oil storage terminal operator at Rotterdam is Koole Terminals, followed by Vopak. There are also various smaller terminal operators with vegetable oil storage capabilities, although their primary focus may be on other streams.

Storage tanks and services

The most common storage vessels for vegetable oils and animal fats are metallic tanks, constructed from different materials to suit the type of oil. The most common material is mild steel, also called carbon steel. “The tanks we use are made of carbon steel or mild steel, and the infrastructure – the lines – are built of the same materials,” Koole Terminals commercial manager Edwin Dominicus-van den Berg, tells Oils & Fats International (OFI). Mild steel is an excellent option for vegetable oil storage due to its affordability, ease of fabrication and suitable mechanical and chemical properties. However, with some vegetable oil products, such as fatty acid methyl esters (FAME), mild steel may require a protective coating on the inside of the tanks and lines to prevent the fatty acids from damaging the metal. Mild steel is not the only tank material. Vopak, for example, also offers stainless steel tanks as an option at its Vlaardingen terminal, says Vopak Vlaardingen sales director Charlotte Kooyman. Whatever the tank material, the stored vegetable oil product must be isolated to www.ofimagazine.com

Photo: Adobe Stock

Robust demand in Rotterdam prevent possible contamination from other liquid cargoes the terminal operators may handle. “Vegetable oil handling has its own ‘system,’ meaning we do not handle other products, like biofuels or oleochemicals, over the same lines that are connected between the jetties and the tank park,” says Kooyman. A designated number of lines are available to ensure that all customers have enough capacity at all points.” Vegetable and animal oils and fats are also typically shipped in ISO metal tanks and containers. Some shipments, however, arrive in flexible tanks (also known as flexibags or flexitanks). These types of tanks are essentially large storage bladders, manufactured out of high-tensile polyester fabrics and covered on both the inside and outside with a flexible polymer coating. They are significantly lighter than traditional metal tanks of comparable volumes and can be easily folded for storage when not in use. However, flexitanks are also notably more fragile and require more careful handling. Both Koole’s and Vopak’s terminals at the Port of Rotterdam are equipped to receive oil shipments in flexitanks. Once stored in a tank, vegetable oil and animal fat products may require further processes to maintain their freshness and quality. To this end, Rotterdam’s storage terminal operators install various equipment in their tanks. “Many tanks are equipped with heating coils, enabling us to heat up the product, which is necessary

for a product like palm oil, for example, as it solidifies at room temperature. We also have tanks with mixers, tanks connected to a nitrogen system, and other options,” Dominicus-van den Berg explains. Both Koole and Vopak offer these types of additional services to their vegetable oil clients, including heating, blending and mixing, and nitrogen blanketing to prevent oxidation during storage. The firms may also be able to help their customers with weighing, customs clearance, and other import/export processes. Finally, they offer separate storage facilities for edible oil products that require maintaining kosher or halal status.

From vessel to tank

In the vegetable oils sector, seagoing vessels importing and exporting oils comprise the main activity at Port of Rotterdam. Most shipments will move through a storage terminal’s tank at some stage, but not every ship or tanker deposits its cargo into a storage terminal. The port also has infrastructure in place that allows vessels to discharge directly at one of the many vegetable oil and biofuel refining facilities operating at the port. There are no one-size-fits-all solutions to moving vegetable oil products but in the following example, the process begins with a typical 30-40,000-tonne parcel tanker carrying tropical oils. The ship’s operator (the storage terminal company’s customer) sends a nomination u OFI – FEBRUARY 2024




to the terminal specifying the type and amount of product the ship its carrying, and indicates which of the terminal’s tanks it wants to discharge in. The terminal operator checks this pre-arrival information to ensure everything will be in order for the ship’s arrival. While performing the pre-arrival checks, the terminal operator will also be in close communication with the ship’s agent. This individual acts as the link between the ship, the terminal, the Port of Rotterdam, and — if necessary — the ship’s owner. The agent updates the terminal on the ship’s location and when it is expected to call at the terminal’s berth, in addition to booking the vessel into the terminal’s planning system. Once the ship arrives at the Port of Rotterdam and the terminal berth, the captain and the terminal operator tender a Notice of Readiness (NOR), an official document indicating the vessel is ready to discharge (or load) cargo. “After all these formalities have been completed, we connect our lines to the ship’s manifold and the ship starts pumping according to the pump plan we agreed on together,” explains Dominicus-van den Berg. From the moment the ship arrives, multiple analyses and inspections are also performed to confirm the cargo’s type, quality and safety. These inspections are carried out by dedicated surveyors before, during and after the pumping process. Once all of the oil product has been securely moved to the storage tank, the lines and hoses are disconnected. For moving oil shipments from tank to vessel, the process works largely in the same way – the pumping direction is simply reversed. Although Rotterdam is a port, both Koole and Vopak receive vegetable oils through other modalities as well. For instance, Kooyman explains that Vopak is able to receive cargo by truck and rail alike. “Vopak’s truck loading and discharging facilities support supply chains to and from locations that do not have river access 20 OFI – FEBRUARY 2024

or locations for smaller quantities. Also, the collection of product from multiple locations is often done by trucks. An important factor why customers require truck access are the larger and more frequent fluctuations in the water levels of the Rhine river,” she says. The demand for block train handling capacity at all Rotterdam terminals is also increasing rapidly. Dominicus-van den Berg gives the example of sunflower oil shipments, which have shifted entirely from ship to rail deliveries due to the ongoing conflict in Ukraine. With this understanding of storage terminal tank operations and the processes used to handle vegetable oils, a more detailed look can be taken into the activities of vegetable oil terminal operators at the Port of Rotterdam.

Storage terminal operators

Koole Terminals (pictured above) operates storage terminals throughout Europe and is a significant player in the vegetable oil industry. Out of the 21 terminals in the Koole network, 18 are capable of handling vegetable oils, animal fats, used cooking oil (UCO), biofuels, or a combination of these products. At the Port of Rotterdam, Koole is the largest vegetable oil storage terminal operator. Each of Koole’s Rotterdam terminals – Maastank, Pernis, Botlek and Minerals – handles at least some of the abovementioned products. At Maastank and Pernis, Koole has storage capacity for plant and animal-based oils and fats, while the Minerals and Botlek facilities are equipped to store biodiesel and hydrotreated vegetable oil (HVO). The Maastank terminal is the latest addition to the Koole network, with the company acquiring the facility from the Dekker Group in January 2023. At Maastank, Koole has 22 mild steel and 61 stainless steel tanks ranging from 70 to 2,400m3 in size. That capacity will soon

expand as Koole is building 13 new tanks at the Maastank facility, which will add nearly 30,000m3 of capacity, bringing the facility’s current total of 87,000m3 to 116,000m3. At the time of writing, the expansion was still under construction but was slated to come online in January 2024. At Maastank, Koole can receive seagoing vessels, barges, trucks, tank containers, and flexibags. A specific niche available at Maastank is receiving and heating containers and flexibags carrying UCO and animal fat. At the Pernis facility, Koole has approximately 675,000m3 of storage capacity, of which roughly two-thirds are mild steel tanks and a third are stainless steel. The tanks range from 150 to 16,400m3. Pernis offers a wide variety of modality options, with three berths for vessels up to Handymax size, eight barge berths, 18 truck loading points and two railway loading stations. The facility also offers many additional services, including steam and hot water heating, air mixing, blending, nitrogen blanketing, customs service assistance and more. The Pernis terminal is connected to the Olenex vegetable oil refinery. The Botlek terminal is Koole’s largest facility at the Port of Rotterdam with a total storage capacity of 1.6M m3, split across 270 tanks mild and stainless steel tanks ranging from 735 to 40,000m3 in size. With the capability to accept shipments through all transportation methods, the terminal primarily services chemical and mineral oil customers but can also handle biofuels. Koole is also constructing a new terminal called KTB-E in the Botlek area. Phase 1 of this facility, with a projected capacity of 150,000m3, was commissioned in 2023 and the full terminal is set to become operational by early 2025. Koole is also expanding its sustainable aviation fuel (SAF) distillation capacity at Botlek, with the aim of increasing production from 200,000 tonnes to 650,000 tonnes. Finally, Koole’s Minerals terminal has 103 mild steel tanks ranging from 1,000 to 30,600m3, with a total capacity of 1.4M m3. This facility primarily handles petroleum oil products but is also capable of storing HVO, biodiesel and ethanol. With loading points for vessels, barges, coasters, trains, and trucks, the Minerals terminal is a crucial link in the Dutch fuel network. Throughout its facilities, Koole handles all types of vegetable oil, animal fat and UCO products, says Dominicus-van den Berg. “Our list includes palm, coconut and palm kernel oils; several grades of oleochemicals derived from palm and coconut oils; animal fat; UCO; palm oil mill effluent; castor, sunflower, rapeseed and www.ofimagazine.com

STORAGE & LOGISTICS soyabean oils; lecithin and more,” he says. The majority of palm oil arriving at Koole’s terminal come from Malaysia and Indonesia, with some product also coming in from South America. Dominicus-van den Berg says Koole primarily services the European region, but exports to the USA, South America, and other regions also move through Koole’s tanks. Royal Vopak NV, headquartered in Rotterdam, is a pioneer in operating vegetable oil storage terminals. Founded in 1929, the Vopak Vlaardingen terminal was one of the first large-scale vegetable oil terminals in the world. Originally a fish and vegetable oil facility, the Vlaardingen terminal has expanded over the years to focus on vegetable oils, oleochemical base oils, biodiesel and biofuel feedstocks. “We store products for our customers from all over the world, including soft oils like rapeseed, sunflowerseed and soyabean oil. We also store tropical oils, such as palm and coconut oil,” details Kooyman. Vopak Vlaardingen has a total storage capacity of 620,261m3, distributed across 310 carbon and stainless steel tanks ranging from 250 to 6,240m3. This includes 16 new tanks which began operations in May 2023, adding 64,000m3 of capacity. Designed to store waste-based feedstocks for biofuel and SAF production (such as UCO and waste animal fat), Vopak built the tanks as part of a long-term commercial agreement with oils and gas giant Shell, which is constructing a SAF refining facility in Rotterdam. “The tanks and infrastructure all have the specific requirements to serve our markets well. Tanks are insulated, coated, and connected to rail and truck facilities to cater to all logistical needs. Vopak has also built custom-made infrastructure solutions for various customers,” Kooyman explains. The Vlaardingen terminal can serve deep-sea vessels, coasters, barges, trucks and rail wagons. Additional services Vopak offers include blending, heating, nitrogen blanketing, weighing, and kosher and halal storage, among others. “A big advantage at Vlaardingen is the fact that many tanks can be used for different product groups and easily connected to different line systems. It makes Vlaardingen flexible in offering growth, while a reduction in customer capacity can easily be compensated by other markets,” she adds. Through the Vlaardingen terminal, Vopak does business with virtually all vegetable oil refiners active at the Port of Rotterdam, such as AAK, Cargill, Neste/Bunge Loders Croklaan, Sime Darby, Olenex and Wilmar. Vopak also collaborates with many trading www.ofimagazine.com

companies and suppliers that ultimately serve the refining companies. Vopak also used to operate an 895,750m3 terminal with vegetable oil capacity in the Botlek area of the Port of Rotterdam, near Koole’s Maastank facility. However, this terminal (alongside the TTR and Chemiehaven facilities) was sold to British infrastructure investor Infracapital in December 2023 for a reported €407M. These facilities will continue operations under Liquin (see below). In addition to Vlaardingen, Vopak operates 76 storage terminals worldwide, 21 of which offer vegetable oil capacity.

Other storage terminal operators

While Koole and Vopak are the leaders of vegetable oil storage terminal operators at the Port of Rotterdam, other companies also offer storage for vegetable oil or related products, such as biofuels. Liquin is the new operator of Vopak’s previous Botlek facility, now called Liquin Terminal Botlek. The facility has 882,683m3 of storage capacity, with 179 mild, carbon, and stainless steel tanks between 508 and 22,480m3 in size. Liquin states that it primarily deals with base oils and oleochemicals, but the Botlek facility is also able to store biodiesel with vessel, barge, rail, truck and pipeline connections. Under Vopak, the terminal also handled vegetable oils but Liquin did not respond to OFI’s inquiry on whether it plans to continue in this sector. Liquin also operates the TTR and Chemiehaven terminals, but these facilities do not offer vegetable oil or biofuel storage. Rubis Terminal operates a 277,000m3 facility in the Port of Rotterdam’s Chemiehaven area. Built in 2008, Rubis’ Rotterdam terminal features 66 tanks with sizes ranging from 1,200 to 12,700m3. The facility focuses on petrochemicals and specialty chemicals, but can also store biofuels. It has connections for seagoing vessels, barges, road trucks, rail wagons and pipelines. Rubis also offers related additional services, including mixing, nitrogen blanketing, blending and heating. Standic runs a 230,000m3 storage terminal in Dordrecht. Although technically outside the Port of Rotterdam, the facility is connected to waterways that can receive vessels through the port. Standic Dodrecht has 161 mild and stainless steel tanks, sized from 204 to 6,600m3 for storing biofuels, chemicals and base oils. Like its competitors, Standic Dodrecht offers connections through vessel, barge, truck and train.

A positive outlook

Confidence in the future is evidenced by

Koole’s and Vopak’s expansion projects. Both Dominicus-van den Berg and Kooyman project growing demand for vegetable oil storage services at the Port of Rotterdam. Biofuels and their feedstocks are likely to be the main growth driver, as both Shell and Finnish petroleum and renewable fuel producer Neste are building additional processing biofuel capacity at the port. That said, the Port of Rotterdam’s vegetable oil storage terminal operators also face their share of challenges. The ongoing Russia-Ukraine war has resulted in significant issues with sunflower oil shipments due to Russia’s blockage of Ukrainian Black Sea ports. “[Our customers shipping Ukrainian oils] had to resort to multimodal alternatives, such as utilising trains or trans-shipments to trucks, in order to transport their oil to Rotterdam,” explains Kooyman. “Consequently, we observed a decline in sunflower oil volumes originating from Ukraine and a swift increase in multimodal solutions like trucks and trains.” According to Dominicus-van den Berg, other pressing issues include product traceability and the EU’s new Deforestation Regulation (EUDR), which is set to ban imports and exports of vegetable oils that do not comply with EU sustainability requirements from 30 December 2024. “Right now, traceability is very important, and the ability to offer several smaller tanks to distinguish between different oil qualities,” says Dominicus-van den Berg. Rotterdam’s vegetable oil terminal operators are closely working with customers to prepare for the changes in certification and due diligence EUDR will require, he adds. Finally, the terminal operators acknowledge that making long-term predictions in their line of business is far from a precise science. Everything from unexpected changes in crop yields to unstable weather patterns or global market developments could cause disruption without warning. A good example of this have been the low water levels in the Rhine River, which continues to pose a challenge for vegetable oil shipments. Despite these issues, the overall outlook for the Port of Rotterdam’s vegetable oil storage terminal operators remains positive. Although European food and feed industry demand for vegetable oils and animal fats is relatively stable, global population growth is expected to drive growing demand for vegetable oils. Koole, Vopak and others are in a position to service this need. “Demand for tank storage in Rotterdam remains robust,” Kooyman says. ● le Kauppila is a former assistant editor at OFI OFI – FEBRUARY 2024



Regulations drive demand Photo: Adobe Stock

Decarbonising the transport sector – which accounts for more than a fifth of carbon emissions worldwide – lies at the heart of global and national regulations to combat combat climate change and reach net zero. The term ‘net zero’ refers to cutting greenhouse gas (GHG) emissions to as close to zero as possible, with any remaining emissions re-absorbed from the atmosphere by oceans and forests. To keep global warming to no more than RED Overall target

1.50C above pre-industrial levels in order to avert the worst impacts of climate change, the United Nations (UN) says that global emissions need to be reduced by 45% by 2030 and reach net zero by 2050. However, “commitments made by governments to date fall far short of what is required”, the UN says.

EU policies

Reaching net zero is at the centre of the EU’s European Green Deal policy, with its ‘Fit for 55’ legislation adopted in 2022 setting out the path to meet this target, including regulations to reduce emissions by at least 55% by the end of this decade. The final two pillars of the EU Fit for 55 package was adopted in October 2023 – the revised Renewable Energy Directive (REDIII) and the ReFuelEU Aviation regulation.


10% of energy 14% energy by 2030

by 2020 Transport sectors Road & rail Part A mandate RFNBO mandate Part B cap

REDIII – FIT for 55 agreement 14.5% GHG reduction by 2030 (~29% by energy)

Road & rail

All transport sectors

3.5% by 2030

5.5% by 2030 (% energy)

1% by 2030 (% energy)


1.7% (can be raised by member states)

Crop cap

7% (post ILUC)

7% or 1pcp higher than 2020 crop % (whichever is lower)

7% or 1pcp higher than 2020 crop % (whichever in lower)

Double counting



Not permitted in GHG, likely permitted for compliance with 29% renewable energy target


5x electricity 4x electricity in road; 1.5x electricity in rail; in road; 2.5x 1.2x biofuels in aviation electricity in rail (post ILUC) /marine (excl 1G)

Removal of renewable electricity multipliers. 1.2% for advanced biofuels and RFNBOs in aviation/marine

Figure 1: European emphasis on waste biofuels with REDIII 22 OFI – FEBRUARY 2024

Source: European Commission/Argus Media

Biofuel policies and mandates around the world are now affecting all forms of transport, including the road, maritime and aviation sectors Serena Lim

REDIII entered into force on 20 November 2023, with EU member states required to implement the law in the following 18 months. REDIII raises the share of renewable engery in the bloc’s overall energy consumption from 32% to 42.5% by 2030. It includes a combined sub-target for green hydrogen and advanced biofuels of 5.5%, of which 1% needs to be supplied by Renewable Fuels of Non-Biological Origin (RFNBOs – green hydrogen and e-fuels) (see Figure 1, left). “In the transport sector, the emphasis is on waste-based and low-carbon biofuels,” said Caroline Midgley, director of biofuels and oleochemicals at Global Data (formerly LMC International, UK), speaking at the 13th ICIS World Oleochemical Conference last October. Member states can choose between a 14.5% GHG reduction target to reduce carbon emissions from the use of renewables, or a binding share of 29% of renewables within final energy consumption in transport by 2023. “This adds extra complexity,” Midgley said, adding that there were many compliance options, such as biofuels, biogas, electricity and RFNBOs, but there was a limit on crop-based biofuels. [At 2020 member state levels, with a maximum share of 7%]. According to Lauren Moffitt, Argus Asia Biofuels & Net Zero deputy editor, REDIII will drive further use of advanced biofuels from Part A feedstocks and RFNBOs (see Figure 2, following page). “Overall, European biofuels demand will double in the next decade but blend caps will limit growth of biodiesel or ethanol,” Moffitt told the International Palm Oil Congress and Exhibition (PIPOC) in November. HVO [hydrotreated u vegetable oil or renewable diesel] will www.ofimagazine.com

BIODIESEL, HVO & SAF u grow the fastest as a result, reaching 51% of total European biofuels demand by 2035, according to forecasts from Argus’ consulting team.

Key US and Canadian regulations National and state legislation are also driving demand for renewable diesel and SAF in Canada and the USA, Midgley, told the ICIS World Oleochemical Conference. The US Renewable Fuel Standard (RFS) is a national mandate that requires a specific volume of biodiesel (biomassbased diesel) to be used each year, In 2023, the volume required was 2.82bn gallons, rising to 2.89bn gallons in 2024. Volumes are set each year by the Environmental Protection Agency (EPA). 24 OFI – FEBRUARY 2024

Biofuels 1st generation

Synthetic fuels 2nd generation Part A *

High ILUC risk

Low ILUC risk

Part B **

Biofuels derived from high ILUC risk & feed crops eg palm oil

Biofuels Biofuels Biofuels Biofuels derived from derived from derived from from feedstocks feedstocks low ILUC feedstocks listed in listed in risk & feed that are Annex IX Annex IX crops eg neither food Part A Part B rapeseed oil crops nor eg POME, eg animal listed in tall oil fats, UCO Annex IX Advanced biofuels


‘Part C’ fuels

Renewable electricity

Other Renewable fuels of nonbiological origin (RFNBO) Recycled carbon fuels (RCF)

* Part A feedstocks: Algae if cultivated on land in ponds or photobioreactors; biomass fraction of mixed municipal waste; biowaste from private households subject to separate collection; biomass fraction of industrial waste not fit for use in the food or feed chain; straw; animal manure and sewage sludge; palm oil mill effluent and empty palm fruit bunches; crude glycerine; bagasse; grape marcs and wine lees; nut shells; husks; cobs cleaned of kernels of corn; biomass fraction of wastes and residues from forestry and forest-based industries; other non-food cellulosic material; ligno-cellulosic material except saw logs and veneer logs. ** Part B feedstocks: Used cooking oil (UCO) and some categories of animal fats

Figure 2: Biofuels – EU classifications and feedstocks California’s Low Carbon Fuel Standard (LCFS) mandates a reduction in GHG emissions from transport, with the mandate for 2030 raised to 20% from 10% recently. Tax credits – The US Inflation Reduction Act 2022 expanded tax credits available to biodiesel and SAF. The US$1/gallon tax credit for biodiesel was extended until the end of 2024. This will then change to a producer credit, eligible only for fuel produced in the USA, for 2025-2027. The bill also creates a producer credit for SAF of US$1.25-1.75/ gallon, depending on the GHG savings The Oregon Clean Fuels Program is similar to California’s LCFS but requires smaller volumes, with an expected GHG reduction target of 10% in 2025. The Washington Clean Fuels Standard came into force in January 2023, with a target to cut GHG emissions in transport by 10% by 2031 against a 2017 baseline. Canada’s Clean Fuel Regulation came into effect in 2023 and requires fuel producers and importers to reduce the carbon intensity of transportation fuels, such as petrol and diesel, with the eventual goal of decreasing their carbon intensity by approximately 15% (below 2016 levels) by 2030. The final target for emission cuts has been increased from 12.5% for both gasoline and diesel to 14.7% for gasoline and 15% for diesel.

Asian mandates

Meanwhile in Asia, mandate hikes were expected to more than double regional biofuels demand by 2035, Moffitt told the

Source: Argus Media

The ReFuelEU Aviation regulation was adopted by the EU Council on 9 October in a bid to boost EU sustainable aviation fuel (SAF) supply. The regulation mandates the replacement of fossil kerosene with bio-kerosene, with SAF currently the only commercial alternative to kerosene, Midgley said. ReFuelEU took effect on 1 January 2024 and requires EU airports and fuel suppliers to ensure that at least 2% of aviation fuels are ‘green’ by 2025, rising to 6% in 2030, 34% in 2040, 42% in 2045 and 70% in 2050. There is also a subtarget for RFNBOs, starting at 1.2% in 2030 and reaching 35% in 2050. “As hydro-treatment is the only available commercial technology, waste oils and fats are expected to be the main feedstock to meet ReFuelEU targets initially”, with crop-based SAF ineligible to be counted, Midgley said. Moffitt said ReFuelEU would drive SAF expansion to 18.7bn litres by 2035, with EU demand for waste feedstock used cooking oil (UCO), rising by 77% from 2022-2035 as the regulation did not cap the use of Part B feedstocks. “Argus forecasts a substantial deficit in UCO and advanced feedstock availability post-2025, worsening by 2030.” Also part of the ‘Fit for 55’ package is the FuelEU Maritime Initiative, which will apply from 1 January 2025. The initiative aims to increase the demand for, and use of, renewable and low-carbon fuels in the shipping sector, with no crop-based fuels permitted. Renewable and low-carbon fuels should represent between 6% and 9% of the international maritime transport fuel mix by 2030, and between 86% and 88% by 2050. “Biodiesel is expected to play only a small role as non-diesel fuels such as bio-methanol and ammonia are slated for widespread use in the future,” Midgley said.

Green fuels

PIPOC 2023 conference. Indonesia had moved to a 35% palm biodiesel blend rate (B35) in August 2023 and biodiesel demand was expected to grow by 67% to 11.2bn litres by 2035, she said. India was expected to reach a E20 ethanol blend target by 2025 and become Asia Pacific’s largest biofuels consumer at 35% by 2035. South Korea had an on-road blending target of 8% by 2030 (3% HVO and 5% biodiesel). “Japan looks set to become a notable market for SAF with a 10% consumption target proposed by Japanese airlines,” Moffitt added. “Asia-Pacific SAF interest is growing but the demand outlook is unclear. With few SAF mandates implemented, Argus forecasts just 700M litres of firm SAF demand in the region by 2035, but there is significant upside potential.”

Decarbonising global aviation

Worldwide, SAF volumes are currently small but expected to grow due to more policy initiatives, Midgley told the ICIS conference. “The most important is the International Air Transport Association (IATA) target for carbon neutrality by 2050.” Many airlines had also announced targets to blend a volume of 10% SAF by 2030. Along with the ReFuelEU regulation for a mandate of 70% SAF (by volume) by 2050, the USA also had ambitious targets to make aviation carbon neutral by 2050 and had set a target to produce 3bn gallons (8.6M tonnes) of SAF by 2030. u “The only commercialised technology www.ofimagazine.com

Source: C Midgley, Global Data


Figure 3: Biofuels SAF demand (million tonnes) u for SAF is hydro-treatment, which requires vegetable oils and fats. Waste oils such as UCO and animal fats are preferred over vegetable oils due to their lower carbon intensity, although it is likely that some vegetable oils such as soyabean oil will be used in the USA,” Midgley said. “In the period to 2030, most SAF supply will come from hydro-treatment. Beyond this, the hope is that new technologies will be commercialised to allow the use of biomass and carbon capture (e-fuels).” “If we take into account future demand for kerosene, the world will need 27M tonnes of SAF by 2030 and 90M tonnes by 2040, dominated by US and EU demand, which will total 80% taken together (see Figure 3, above).” Midgley said the development of SAF would put further pressure on feedstocks such as UCO and tallow. “It is expected that some feedstocks will be diverted from renewable diesel (given over-capacity in this sector) as well as from fatty acid methyl ester (FAME or biodiesel) production, which traditionally has very modest margins.”

The role of palm oil

To address the unintended consequence of releasing more carbon emissions due to growing crops for fuel, the EU introduced specific criteria for high-risk indirect land use change (ILUC) biofuels in the second version of the RED. In its Delegated

Asia Pacific Europe Latin America TOTAL

2024 10.7 1.0 1.0 12.6

2025 11.6 0.7 1.0 13.3

Regulation 2019/807, published in May 2019, the EU defined high-risk ILUC biofuels, with only palm oil falling under this category. In addition, the EU adopted its Deforestation Regulation (EUDR) on 19 April 2023, with member states given 18 months to implement it. “The legislation seeks to minimise the EU’s contribution to deforestation and forest degradation,” Midgley said. “The EUDR views palm oil as posing the greatest threat, closely followed by soyabean.” Other ‘at risk’ commodities are cattle, cocoa, rubber and wood. “All these products and their derivatives must be deforestation-free when imported into or exported from the EU. Operators, including traders, had to undertake due diligence on relevant products and infringement of the regulation was subject to penalties linked to company turnover, Midgley said. “The EUDR will require the collection of a lot of information, most importantly geolocation data.” It requires: 1. Collection of information, data and documents to demonstrate that a product comes from land not subject to deforestation, including the provision of geo-location data identifying the plot of land where the commodity came from. 2. Risk assessments to be carried out taking into account the risks relevant

2026 12.5 0.5 1.0 14.0

2027 13.6 0.4 1.0 15.0

2028 13.9 0.3 1.0 15.2

2029 14.1 0.1 1.0 15.3

2030 15.5 – 1.0 16.6

to the country of production including the presence of forests in the country, the presence of indigenous peoples, the prevalence of deforestation present in the country, the reliability of information available and the potential for corruption, among other factors. 3. Risk mitigation – an operator is required to adopt risk mitigation procedures and measures that are adequate to achieve no deforestation or only a negligible risk of deforestation. Member states must designate one or more competent authorities responsible for fulfilling obligations arising from the regulation. The competent authorities are required to carry out checks within their territory to establish whether operators and trades established in the EU comply with the regulation. Despite the deforestation regulation reducing demand from the EU, Moffitt said global crude palm oil demand for biofuels production was expected to increase by 70% by 2035, driven by growing biodiesel mandates and low SAF demand in Asia Pacific (see Figure 4, below). “Latin American is expected to surpass Europe as second largest palm oil consumer for biofuels by 2024 and growth in Asia Pacific demand is forecast to outweigh decline in Europe.” ● Serena Lim is the editor of OFI

2031 15.8 – 1.0 16.8

2032 16.0 – 1.0 17.0

2033 16.2 – 1.0 17.2

2034 16.5 – 1.0 17.4

2031 16.7 – 1.0 17.7

Figure 4: Crude palm oil demand for biofuels production (million tonnes)

Source: Argus Media

26 OFI – FEBRUARY 2024



Photo: Adobe Stock

Sector under pressure Global sunflowerseed and oil production are forecast higher this season but leading producer Ukraine’s growth and exports are still hampered by its ongoing war with Russia, while Houthi attacks on vessels in the Red Sea are increasing the cost of shipping from Europe to Asia Dylan Carter

Nearly two years since Russia invaded Ukraine, the global sunflowerseed and oil sector is still under pressure from supply side shocks, restricting short-term growth. Despite an overall increase in global production of sunflowerseed, experts warn of difficult conditions for crushers and growers faced with decreased profitability and stiff Russian competition. In Ukraine, Russia’s military blockade, war damages and falling margins have led to a sharp decline in the attractiveness of its sunflower products outside of Europe, with Russian sunflower exports increasingly penetrating developing economies in Asia and Africa which have not sanctioned Russian trade. In Europe, which has sharply limited trade with Russia, Ukrainian products continue to dominate the market.

according to the US Department of Agriculture (USDA). Total global imports totalled 8.5M tonnes and exports 14M tonnes (see Table 1, p30). Consumption of sunflower oil is on the rise internationally, Straits Research says, with total global domestic consumption increasing by 16.5% between 2021/22 and 2023/24. High-oleic (HO) sunflower oil fetches higher prices on the market due to their greater levels of oleic (monounsaturated) acid and improved oxidative stability. Europe, Argentina and the Ukraine are the main producers of HO sunflower oil and, according to Pavlo Martyshev, food markets expert at Kyiv School of Economics (KSE), growing HO sunflowerseed is increasingly popular in Ukraine, even if it remains a niche sector.

Sunflower sector dynamics

General market trends

The size of the global sunflower oil market is expanding, driven by health-conscious consumer demand for lower fat-content seed oils. In 2023, the sunflower oil market was valued at US$20.47bn, with a compound annual growth rate (CAGR) of 5.85% through to 2030, according to India-based Straits Research. In 2022/2023, global production of sunflower oil exceeded 22M tonnes, 28 OFI – FEBRUARY 2024

A key problem for Ukraine and other sunflower oil producers is that prices in the vegetable oil market fell during 2023. The UN Food and Agriculture Organization (FAO) food price index for vegetable oil reveals a 32.7% reduction in prices for 2023, sinking to a three-year low amid improving global supplies and improved maritime freight rates. According to the USDA, global www.ofimagazine.com

SUNFLOWERSEED & OIL sunflower oil production rebounded by 3.2% between 2021/22 and 2022/23. Similarly, total global imports rapidly rose by 9.2% and exports by 13% over the same period. The USDA forecast for 2023/24 reveals a slightly more pessimistic recovery scenario for the general vegetable oils sector. While global production is expected to expand further (4.77%), alongside total crush (3.31%) and ending stocks (10.76%), global imports are set to shrink (–2.37%), alongside total exports (–3.51%).

Price shocks

Sunflower oil experienced three major price shocks in 2023. In the summer months, prices actually rose following Russia’s withdrawal from the UN-brokered Black Sea Grain Initiative in July 2023, which had facilitated Ukrainian food, grain and oilseed exports. In response to this external shock, India increased its imports of sunflower oil products by 73%, further rallying prices. These were further inflated by increased freight and insurance costs in the Black Sea. Approximately 50% of all Ukrainian sunflower oil products are exported through vulnerable Black Sea ports, according to Martyshev, rather than safer but more cumbersome overland routes into the EU. But prices quickly fell again from August as it became apparent that Ukraine could still rely (to a limited extent) on alternative maritime routes, such as its Danube ports or a new Black Sea corridor hugging the Romanian and Bulgarian coast to the Bosphorus. At the start of 2024, Houthi piracy in the Red Sea has increased the cost of shipping from Europe to Asian markets significantly, increasing freight rates by up to 50%. It remains to be seen whether these delays to shipping will further weaken Ukrainian sunflower oil exports to Asia and impact prices. Martyshev believes that the new Black Sea corridor provides new opportunities for Ukraine to increase its sunflower oil exports, significantly reducing demurrage rates paid on vessels waiting in ports. “The rate for sunflower oil demurrage was US$1.50 per tonne/day [in May 2023] … For grain it was US$0.30/ tonne. That means if a ship waits in the Bosphorus for one month, it loses US$50/ tonne … Our new corridors, without [the risk of attack from] Russia, are more effective as they have no such damages,” Martyshev explains.

exports, despite the ongoing Russian military aggression, including strikes on Ukrainian port infrastructure and the capture of fertile sunflower growing areas in eastern Ukraine and production facilities such as Zaporizhzhya Oblast’s Pologi Oil Extraction Plant. In March 2023, Ukraine set a record for total monthly sunflower oil exports of 524,000 tonnes. KSE expects that Ukraine will produce 12M tonnes of sunflower oil this season (September 2023- August 2024), an increase of more than 2M tonnes compared with the previous marketing year. KSE says Ukraine also increased its

planting area for sunflowerseed to 5M ha for the 2023/24 marketing season. Despite higher production in March, sunflower growers, crushers and processors are under increasing pressure due to falling prices. “The profitability of sunflower growing was quite low before the war. But now it is close to 0% because we have high production costs,” Martyshev notes. “The gross margin for processing plants is also low due to the decline of global oil prices.” Major producers, such as Kyiv-based sunflower oil producer and exporter Kernel, enjoy lower costs and higher profitability. u While smaller processing plants, which

Ukraine capacity problems

Ukraine has also been managing to maintain sunflower production and www.ofimagazine.com




2019/ 2020

2020/ 2021

2021/ 2022

2022/23 2023/24 Revised Forecast

Area harvested (‘000 ha)







Yield (tonne/ha)







Production Argentina EU China Russia Ukraine USA South Africa Turkey Other TOTAL

3,530 9,482 2,550 12,756 15,250 956 678 1,530 5,292 52,024

3,020 9,469 2,680 15,379 16,500 887 810 1,700 5,202 55,647

3,200 8,969 2,750 13,420 13,900 1,353 678 1,580 4,995 50,845

3,360 10,389 2,880 15,660 16,900 864 846 1,750 5,652 58,301

4,130 9,520 2,930 16,600 12,400 1,276 724 1,820 5.834 55,234

3,600 9,863 3,000 16,800 14,400 1,027 830 1,320 5,674 56,514

Seed import Turkey EU Other TOTAL

1,051 550 1,445 3,046

1,058 1,057 1,451 3,566

844 817 1,308 2,969

673 1,807 1,639 4,119

981 1,466 1,513 3,960

580 896 1,571 3,047

Seed exports Argentina USA Russia Ukraine Other TOTAL

149 87 338 119 2,392 3,085

214 64 1,278 76 1,980 3,612

178 72 528 186 1,907 2,871

158 69 280 1,793 1,875 4,175

91 64 285 1,685 1,750 3,875

140 72 352 640 1,806 3,010







Iran Turkey Egypt EU India Others TOTAL

797 529 452 2,128 2,328 5,171 11,405

527 772 398 2,479 2,514 6,881 13,571

903 719 204 1,720 1,958 5,872 11,376

668 1,065 281 2,322 1,956 4,968 11,260

729 1,262 293 2,482 2,988 6,243 13,997

760 1,150 340 2,649 2,470 6,592 13,961

Oil exports Argentina EU Russia Ukraine USA Others TOTAL

968 482 2,763 6,041 55 1,277 11,586

675 875 3,706 6,763 40 1,640 13,699

796 671 3,228 5,250 45 1,337 11,327

894 846 3,193 4,725 56 1,697 11,411

945 1,187 4,217 5,447 33 2,073 13,902

980 1,078 4,400 5,530 32 2,057 14,077



Production Imports

Source: US National Sunflower Association from Oil World & USDA, updated 16 January 2024

Table 1: Global sunflowerseed & oil production and trade, Oct-Sept, (‘000 tonnes) 30 OFI – FEBRUARY 2024

u make up most of the Ukrainian sunflower industry, pay US$60-80/tonne for sunflowerseed, Kernel can buy for as low as US$20/tonne, thus enjoying greater gross margins, Martyshev says. Dmitryu Puzyrov, head of sales at the Znamenovsky Oil Extraction Plant in Ukraine’s Dnipropetrovsk region, told OFI that his company’s sunflower oil processing plant was temporarily forced to switch from an export focus to domestic markets because of “prices on the foreign market and delays with border crossings [for land-based trades], in order to maintain sales.” Puzyrov says sunflower oil exports that remain are principally destined for European biodiesel production and for the European food industry, and are moved by land, coastal sea and river routes. And despite the successes in bypassing the Russian blockade, Martyshev stresses that crushing capacities are under-utilised. Total sunflowerseed crushing capacity is around 18M tonnes but the sunflowerseed harvest this season is forecast at just 12M tonnes, he says.

Ukraine losing market share

Ukraine is losing ground in the sunflower oil market to Russia, which has a zero export duty on sunflower oil, which it has extended into 2024. Low prices from Russian exporters who have much safer export routes have allowed Russia to increasingly take market share from Ukrainian products in Asian markets, says Martyshev. “There are huge crops of sunflowers in Russia, with planting areas of more than 9M hectares. Their export duty is zero for sunflower oil. It is quite profitable for Russia to sell sunflower oil to Indian markets now.” This increased competition is illustrated by a dwindling Ukrainian market share. According to Dutch commodities platform Vesper, from a 46.67% global market share in 2020/21, Ukraine now holds 40.51% of the international market. Meanwhile, Russia’s share has increased from 28.73% to 30.82%. In the previous marketing year, (September 2022- August 2023), Russia increased its exports by 28.57% year-on-year. The result of this shift is an increasingly narrow market for Ukrainian products. “Before the war we supplied to more than 120 countries,” Martyshev says. “Now it is just over 90. Our geography has decreased and we need to sell more to the EU.” ● Dylan Carter writes for International News Services, UK www.ofimagazine.com

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Photo: Sime Darby Plantation

Future of plantations Sime Darby Plantation is mechanising, automating and digitalising its operations in a bid to reduce its dependence on manual labour Gill Langham From pesticide spraying drones to unmanned ground vehicles, Sime Darby Plantation (SDP) is introducing technology throughout its operations in Malaysia to tackle difficult tasks and reduce its reliance on manual labour. Such measures are crucial as dependence on cheap foreign manual labour has made the industry vulnerable, according to SDP group managing director Datuk Mohamad Helmy Othman Basha. These initiatives align with SDP’s wider aim to reshape the perception of the palm oil industry, moving from “dirty, dangerous and difficult” to “attractive, cutting-edge and tech-driven”, he says. Alongside the large-scale mechanisation, digitalisation and automation of its operations, Malaysiabased SDP – which produces 1.887M tonnes/year of certified sustainable palm oil (CSPO) – is aiming to reduce 50% of its non-harvesting workers by the end of 2024, while working towards a 100% local workforce by the end of 2027. This drive is expected to contribute to an improved land-to-worker ratio of 1:17.5ha or one worker for every 17.5ha, 32 OFI – FEBRUARY 2024

compared to the current average industry ratio of 1:8ha. With increased mechanisation and digitalisation, SDP’s land-to-worker ratio recorded an improved ratio of 1:12.4ha at the end of October 2023. Digital and AI technologies are rapidly evolving and change within the industry is inevitable, Mohamad Helmy says. “Sooner or later, the palm oil industry, too, must change the 3Ds stigma that it has been associated with. “Modernising ‘dirty, dangerous and difficult’ tasks through automation and advanced mechanisation is necessary to increase productivity and cover a wider area of plantations more efficiently and for longer periods than humans can ever achieve manually,” he says.

Project Infinity

A reliance on manual labour, particularly foreign workers, was a critical issue for SDP’s operations in Malaysia at the height of the COVID-19 pandemic. With foreign workers returning to their home countries and the company unable to replace them due to movement restrictions and the closure of international borders, there was a sharp drop in productivity. Resolving to find a long-term solution to its labour shortage, the company launched its Project Infinity initiative in 2020, which aims to develop and explore new technology to reduce the need for manual workers in labour-intensive processes. One of the earliest new approaches deployed by the company was the use

of Unmanned Aerial Vehicles (UAV) or drones. By using drones, SDP has reduced almost 100% of its workforce used for pest and disease (P&D) spraying in nurseries and immature areas in its operations in Peninsular Malaysia. SDP says increasing mechanisation would ultimately allow the company to increase productivity with fewer workers. In addition to introducing drones for pest and disease control and nursery maintenance, the company is also using ground vehicles to mechanise work such as herbicide and fertiliser application. “Our goal is to accelerate the mechanisation and automation of more tasks in our plantations and pave the way for a more skilled and educated workforce at the estate level,” Mohamad Helmy says. “We cannot eliminate entirely the need for manual labour, but we can reduce our dependency and introduce initiatives to support upskilling.” As a result of the company’s mechanisation programme, SDP has increased its proportion of local workers to 40% compared to 25% prior to the pandemic.

Project Lokal

In conjunction with Project Infinity, SDP also introduced Project Lokal, aimed at recruiting skilled local talent to oversee mechanised and automated plantation operations in positions such as machine specialists and drone operators. By making plantation work less physically demanding, SDP says it is also fostering inclusivity and diversity, for www.ofimagazine.com

COMPANY PROFILE example, by encouraging more women to enter the industry. After hiring its first female machine specialist in April 2022, SDP now employs a team of 22 female operators. The company also has female estate managers, a female refinery head, a female palm oil mill manager and its first female regional CEO in its upstream operations.


The company has launched a range of initiatives over the last few years – some developed internally, and others codeveloped with start-ups and technology providers – to mechanise and modernise its operations. While some have been introduced across the group’s Malaysian operations, others are either in the prototype or concept stage. Machines currently in use mainly carry out crop evacuation work and the upkeep of nurseries as well as immature and mature fields. The company’s mechanised solutions cover different terrains in oil palm plantations. For example, to control the rhinoceros beetle pest for immature palms, SDP has collaborated with several drone manufacturers to research the use of UAV point-to-point (UAV PTP) sprayers to spray pesticides. The UAV PTP can deliver precision pesticide spraying using artificial intelligence (AI) over a larger area of land at reduced cost. It reduces labour by 70% and covers 8ha-10ha a day, compared to 2ha a day by manual workers. The drone also flies autonomously and sprays oil palms on hilly and terrace areas, a task that would be difficult for workers to access. SDP has deployed the UAV PTP technology over 14,000ha on its estates, reducing dependency on workers to carry out manual spraying. The company is also looking out for more advanced drones and other technology solutions to further reduce its reliance on manual labour. Other machines developed by SDP include the ST 101 Geo or the automatic Strip Herbicide Sprayer machine for mature fields. This machine reduces SDP’s labour force by five workers and covers 20ha/day, compared to 5ha/day when done manually. SDP has also developed a Mechanised Rat Bait Applicator (MeRBA), a rat bait dispensing machine that mechanises rodent control in oil palm estates. The machine improves productivity to 30ha/day compared to 10ha/day when done manually and also minimises www.ofimagazine.com

“Modernising ‘dirty, dangerous and difficult tasks’ is necessary to increase productivity and cover a wider area of plantations more efficiently” workers’ physical contact with rat bait to further improve workplace health and safety, the company says. The company has also developed a Mechanised Targeted Fertiliser Applicator (MTFA) designed to work on a range of terrains. The machine can cover an average of 8ha/day compared to 2ha/day when done manually. A key area still being studied by SDP is the harvesting of oil palm fruits, which traditionally requires skilled manual labour. Due to the complexity of the harvesting process, a mechanised solution is challenging. However, SDP’s robotics unit is working with several start-ups and organisations to find a viable mechanised solution for oil palm harvesting including UAV, Unmanned Ground Vehicle (UGV), robotics and other mechanisms such as lasers that are currently at the prototype or concept stage.

Plantation management

To enable plantation workers to conduct mapping, imaging and data collection, SDP uses drones equipped with high-tech cameras. In place of traditional Global Positioning System (GPS)-based mapping technologies, the company says it will continue to improve its drone and satellite imaging capabilities to map out its plantations in near real-time. In this way, the company will be able to improve its ability to identify diseases and manage outbreaks more effectively by focusing on the needs of each oil palm on its plantations. The company is applying the most advanced geo-spatial technologies in areas planted with its super high-yielding seeds, the GenomeSelect. Each GenomeSelect palm is now tagged

with its own GPS location which helps SDP keep track of their locations. By regularly taking images of the GenomeSelect fields, the company says it can measure the palms’ growth rate and forecast their yield for the year ahead. Aerial images map the topography and help the company understand how water is distributed across its estates, so it can design a more efficient water management system by building canals and drainage systems accordingly. Monitoring technologies also help the company to see which areas of the plantation need harvesting. SDP says the use of imaging also helps it identify the presence of diseases to manage outbreaks and reduce infections in oil palms across its nurseries and estates.

Increasing yields

In addition to reducing its dependence on manual labour, SDP is also aiming to improve productivity. As part of that drive, the company is scaling up production of its GenomeSelect seed to meet all its replanting needs. The super high-yielding seed is the result of SDP’s research into oil palm genomics since 2007. In its first commercial harvesting in 2019 three years after being planted, GenomeSelect oil palms recorded a 20% increase in yield compared to SDP’s previous best planting material, the calixQ6. The GenomeSelect oil palms planted in 2018 also yielded 10%-34% more oil/ha across coastal, inland, and basaltic soils in SDP’s operations in Malaysia from 2021-2022. In November 2023, the company’s super high-yielding seed became commercially available in the market.

Future outlook

Looking ahead, Mohamad Helmy says SDP will continue to increase mechanisation, automation and digitalisation throughout its operations to further improve the land-to-worker ratio while increasing recruitment of local workers. “Through collective effort and a commitment to responsible practices, we believe we can navigate the challenges [of modernising plantations] and help to carve a sustainable future for the industry,” he says. “SDP’s operations currently cover only 5% of the planted hectarage in Malaysia – imagine what we can achieve if we could mechanise 50% more hectarage with more involvement throughout the industry?” ● Gill Langham is the assistant editor of OFI OFI – FEBRUARY 2024



Photo: Adobe Stock

Health applications Oilseeds and vegetable oils have essential functions in human health, and contain many compounds that can also act as nutraceuticals and antioxidants Guttarla Nagaraj Oilseeds are rich a rich source of oil, proteins and carbohydrates. In addition to their major nutritional constituents, oilseeds and oils also contain highly useful components. These include minerals, vitamins, essential fatty acids, phenolics, phytosterols, polyphenols, flavonoids, isoflavones, lignans, phytosterols, amino acids and peptides. These constituents play an important role in human health, playing a role in essential body functions as well as acting as nutraceuticals and antioxidants. Some toxic constituents of oils such as glucosinolates, gossypol and ricin also appear to have health-promoting properties.

Carbohydrates and proteins

Carbohydrates are a main source of energy for the human body and can be found in sugars, starches and dietary fibre. Carbohydrates play a role in our immune system, blood clotting and reproduction, 34 OFI – FEBRUARY 2024

in addition to providing instant energy to the body. Although carbohydrates are not an essential nutrient, they are still helpful to the body as a source of energy. Proteins provide many benefits to our body such as the speeding up of recovery after exercise and/or injury, reducing muscle loss, building lean muscles, helping maintain a healthy weight and curbing hunger. As a macronutrient, protein must be eaten in large quantities and should be a part of all meals consumed throughout the day. At least 30% of our energy needs come from proteins. The quality of a protein mainly depends on the amount of essential amino acids it contains and its digestibility. Protein is a polymer built up by about 21 amino acids, out of which a few are essential (when the human body cannot synthesise it and it needs to be supplied via the diet). Proteins with more essential amino acids are considered healthier.

Fats and oils

Oils and fats supply calories and essential fatty acids such as linoleic and linolenic acids, which the human body cannot synthesise and therefore needs to be sourced via consumption. Oils and fats also help the body absorb fat-soluble vitamins such as A, D, E and K. Between 20-35% of our daily calories need to come from fats and oils. Vitamin A – found in oils – promotes

eye and skin health and our immune system. Our body’s skin cells synthesise vitamin D with the help of sunshine and cholesterol, and this vitamin helps to support bone health and nerve function. Vitamin E – an antioxidant – can protect cells against environmental damage and is available in most oilseeds and their oils. The fourth fat-soluble vitamin, K, is a key nutrient in blood clotting mechanisms.

Fatty acids

Most oilseeds and their oils contain two essential fatty acids – linoleic and linolenic acids. These polyunsaturared fatty acids (PUFA) reduce total and low density lipoprotein (LDL), so called ‘bad’ cholesterol. They also improve insulin sensitivity and blood pressure. Sometimes referred to as Vitamin F, linoleic acid is one of the most effective ingredients in skin care, strengthening the skin’s protective barrier, while providing excellent moisturising and healing properties. Linoleic acid has a critical role in healthy brain function. It is involved in neuro-transmission and in the response to ischemic brain injury, such as stroke. A deficiency in linoleic/linolenic acids may lead to scaly and itchy skin. Using oils high in these acids on hair helps promote hair growth and in treatment for thinning hair. Impaired reproductive health is a symptom of essential fatty acid deficiency. Linoleic and linolenic acids are essential www.ofimagazine.com

OILSEEDS/ANTIOXIDANTS components of all cell membranes, they influence the production of reproductive hormones, namely, prostaglandins. The reproductive system alsp requires a high PUFA content to provide plasma membranes with the fluidity that is essential for fertilisation. Polyunsaturated fats in both the omega-6 and omega-3 families are useful in human autoimmune-inflammatory disorders. PUFAs are essential for higher bone mineral density, leading to reduced risk of fragility fractures and osteoporosis. Most oilseeds and their oils contain linoleic acid ranging from 30-70%. Linolenic acid is present in smaller quantities ranging from 3-10% in a few edible oils. Flaxseed oil is the richest in linolenic acid with up to 60% content.


Antioxidants are compounds that protect our cells against free radicals, which have a role in tumour production. Vitamin C and E (tocopherols), carotenoids (vitamin A precursors), flavonoids tannins, phenols and lignans are well-known antioxidants that prevent the propagation of free radicals in cell membranes. Carotenoids act as strong antioxidants, in addition to playing a function in plant photosynthesis. The main carotenoids that have an essential role in human health are βcarotene, α-carotene, lycopene, lutein, cryptoxanthin and zeaxanthin. Tocopherols and tocotrienols are vitamin E homologs, serving as strong antioxidants and have many essential physiological functions such as acting as an anti-coagulant and an essential regulator of metabolic processes including inflammation and cancer in humans. Vitamin E is also indispensable for immune defence. It has been suggested that tocopherols, acting as hormones or as secondary donors of genetic information, control the expression of some genes. Vitamin E deficiency causes damage of cellular membranes resulting from oxidation of the unsaturated fatty acids in lipids. Vitamin E deficiency can also display itself as muscular pain and progressing muscular disorder. Tocotrienols have hypocholesterolemic, anti-cancer and neuroprotective properties. Phenolic compounds are a wellknown group of secondary metabolites with wide pharmacological activities. Phenolic compounds in many plants are polymerised into larger molecules such as the proanthocyidins (condensed tannins) and lignins. www.ofimagazine.com

Several compounds in rice bran oil have been reported to have antioxidant and anti-inflammatory effects

Phenolic acids are present in food plants as glycosides or esters with other natural compounds such as sterols, alcohols, glucosides and hydroxy fatty acids. Increased bile secretion, reducing blood cholesterol and lipid levels, and antimicrobial activity are some of the biological activities of phenolic acids. Phenolics also have anti-ulcer, antiinflammatory, antioxidant, cytotoxic, anti-tumour, anti-spasmodic, and antidepressant activities. Phenolic compounds are present in most oilseeds especially in the hull and seed coat. Consumption of whole seeds is therefore considered good for the health.


Plant sterols protect against many chronic ailments such as cardiovascular diseases, cancer, ulcers, diabetes and inflammation. The main sterols present in oilseeds and their oils are beta sitosterol, campesterol, and stigmasterol. Plant sterols mimic cholesterol and reduce the absorption of cholesterol. They are considered to have anti-inflammatory, anti-bacterial, anti-atherosclerotic, antioxidative, anti-ulcerative and anti-tumour properties in humans.

Oilseed compounds

The content and composition of useful compounds in oilseeds varies according to the specific seed. Groundnuts contain a phenolic compound called resveratrol at 2.02.5mg/kg of seeds. This compound, also present in red wine, has been associated with reduced cardiovascular disease and cancer risk. Glucosinolates are present in mustard seeds and play a role in reducing inflammation and in the body’s stress response, with antioxidant and anti-

microbial properties. Castor oil’s ricinoleic acid (hydroxy fatty acid) has been shown to reduce swelling and pain caused by inflammation in research in animals. One study in people found it was as effective at treating symptoms of knee arthritis as a nonsteroidal anti-inflammatory drug. Ricin – a toxic protein present in castor seeds – has been reported as a potential chemical for cancer treatment. Sesamin, a major lignin present in sesame seeds and sesame oil, has reported antioxidant and antiinflammatory properties. Several studies have revealed that oxidative stress and inflammation play a major role in a variety of cardiovascular diseases (CVDs). Sesamol, another lignin component of sesame, also has reported antiinflammatory, antioxidant and neuroprotective properties. Several compounds in rice bran oil have antioxidant and anti-inflammatory effects. One of these compounds is oryzanol, which has been shown to suppress several enzymes that promote inflammation. In particular, it may target inflammation in blood vessels and heart membranes. Oryzanol has also been used to help control body weight, and in skin and hair health. Gossypol is a polyphenolic compound present in cottonseed gossypol and has been the subject of numerous studies due to its diverse biological properties including anti-fertility, anti-viral, antioxidant, anti-bacterial, anti-malarial, and anti-tumour activities. People most commonly use gossypol for birth control as it interferes with sperm development and function. ● Guttarla Nagaraj is the former principal scientist and head of crop production at the ICAR-Indian Institute of Oilseeds Research OFI – FEBRUARY 2024



Sunflower oil Mintec benchmark price (US$/tonne), fob NW Europe


Sunflowerseed and sunflower oil

The Mintec Benchmark Prices (MBP) for sunflower oil (6 ports option) was assessed at US$970/tonne on 25 January, up 4.2% month-on-month (m-o-m); a 16.7% year-on-year (y-o-y) decline. Recent m-o-m volatility in the MBP is attributable to increased demand as many buyers sought coverage and looked to replenish diminishing stocks. Further price support came from ongoing issues in the Suez Canal, which have led to disruptions in European and Black Sea shipments, with shipping times prolonged by three to five weeks. Market players have also reported that short supply and elevated olive oil (close substitute) prices could continue to provide upside risk in the short term. According to the US Department of Agriculture (USDA), global sunflowerseed supply for the 2023/24 marketing year is expected to increase by 6% y-o-y to 55.5M tonnes, with y-o-y risers expected in major producers Russia (+5.2%), Ukraine (+18.9%) and the EU (+11.1%).


Rapeseed and rapeseed oil

Rapeseed oil Mintec benchmark price (€/tonne), fob Rotterdam

The MBP for rapeseed oil FOB Rotterdam fell by 2.8% m-o-m and 18.6% y-o-y to €854.4/tonne, as assessed on 26 January, due to subdued demand. Further downward price pressure can be expected as crushers look to continue the pace of activity, increasing rapeseed oil supply. The USDA projects global rapeseed production for the 2023/24 season to decline by 1.9% y-o-y to 87M metric tonnes. According to Statistics Canada, Canadian canola production for the 2023/24 season is estimated to reach 18.3M metric tonnes, reflecting a 5% y-o-y fall.

Soyabean oil production, consumption and ending stocks (million tonnes)

Prices of selected oils (US$/tonne) July 23

Aug 23

Sept 23

Oct 23

Nov 23

Dec 23








Crude palm







Palm olein




























Palm kernel





















36 OFI – FEBRUARY 2024



Soyabean and soyabean oil

The Mintec Benchmark Prices (MBP) for soyabean oil FCA Netherlands was assessed at €924.5/tonne, down 3.7% m-o-m and 22.6% y-o-y. Soyabean oil prices in the EU have been pressured by subdued demand due to availability of alternative oils, particularly rapeseed oil. Prices on the Chicago Board of Trade (CBOT) have followed a similar trend, with CBOT soyabean and soyabean oil futures prices (March 2023) down by 6.5% and 1.9%, respectively. Weather conditions in South America have been the major price driver in the soyabean and soyabean oil markets recently. In the 2022/23 season, Brazil saw a record 160M tonnes crop but adverse weather has led to successive downward revisions for this season, with the USDA pegging the crop at 157M tonnes in its January update, down 1.9% y-o-y. Huge carry in stocks from 2022/23 are still expected to keep total supply higher y-o-y. Brazilian crop losses have been offset by expectations that Argentina’s crop is expected to recover by 100% y-o-y to 50M tonnes this season, following last seaon’s severe drought. Mintec provides independent insight and data to help companies make informed commercial decisions. Tel: +44 (0)1628 851313 E-mail: sales@mintecglobal.com Website: www.mintecglobal.com


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