OFI November December 2021

Page 28

The cotton challenge The cottonseed oil sector – along with the wider cotton industry – is taking steps to tackle the sustainability challenges it faces Gill Langham Cottonseed oil production is expected to increase – at least in the short-term – mainly due to increasing global demand from the food sector, according to industry analysts. A by-product of cotton processing, cottonseed oil is extracted from the seeds or kernels of cotton plants and is used for salad oil and dressing, mayonnaise, and is also suitable for cooking and frying. Cottonseed oil has a mild, nut-like taste and is clear with a light golden colour, which makes it a versatile product. Global cottonseed oil production has been stable at around 5M tonnes during the last decade, according to Statista, dipping to 4.25M tonnes in 2015/16, and reaching 4.86M tonnes in 2020/21. Production peaked in 2018 and is likely to continue its growth in the immediate term, according to the Global Cottonseed Oil Market Insights 2007-2019 and Forecast 2020-2025 report, available from Research and Markets. Consumption is also expected to 26 OFI – NOVEMBER/DECEMBER 2021

Cottonseed Oil working draft Gill.indd 2

continue on an upward trend over the next few years, the report says, to reach 6.3M tonnes by the end of 2025. However, any potential growth in the sector would be limited for a number of reasons, according to Stephen Nicholson, vice president, RaboResearch Food & Agribusiness, Grains & Oilseeds. “In the short to medium term, the demand for vegetable oil is expected to grow due to demand from the biofuels sector, particularly renewable diesel. However, I don’t believe cottonseed oil will be a beneficiary,” he says. Price is a major factor, according to Nicholson, with cottonseed oil the highest priced vegetable oil in the USA second only to peanut oil. “Since the mid-1990s, the production and demand for cottonseed oil has decreased due to price,” he says. “Demand for cottonseed and a small supplier base make cottonseed oil sometimes difficult to procure.” Cottonseed production has been steady to down over the last 10 to 15 years, according to Nicholson, with the same pattern for crushing and exports. More cottonseed is going into dairy feed channels, Nicholson says, which is one of the main reasons cottonseed oil production is down. “Cottonseed oil has a place in food applications and that is not going to go away overnight, but if prices persist at these high levels, manufacturers will look for alternatives to cut cost.”

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OILSEEDS

Market leaders

The top global producers of cottonseed oil in 2021 are India and China with 1.39M tonnes and 1.36M tonnes respectively, according to United States of Agriculture (USDA) figures. Other notable producers include Brazil (680,000 tonnes), Pakistan (318,000 tonnes), the USA (220,000 tonnes), Uzbekistan (204,000 tonnes) and Turkey (196,000 tonnes). Smaller producers include Australia, the EU-27, Mali, Myanmar and Turkmenistan. From 2007 to 2018, the most notable rate of growth in terms of cottonseed oil production, among the main producing countries, was attained by Australia, according to the Global Cottonseed Oil Market Insights report. In 2018, approximately 168,000 tonnes of cottonseed oil were exported worldwide, the report says, a 17% increase on the previous year although exports continued to decline slightly. Of the main exporting countries, Australia experienced the highest growth rate of exports over the 11-year period with a more modest pace of growth for other global leaders. Global cottonseed oil imports reached 141,000 tonnes in 2018, a 14% increase on the previous year, according to the report. However, imports continued to indicate a relatively flat trend overall. Major importers of cottonseed oil in 2018 included Mexico (16,353 tonnes), www.ofimagazine.com

25/10/2021 14:49:58


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