Safflower Oil Price Trend and Forecast

Safflower Oil Regional Price Overview

Get the latest insights on price movement and trend analysis of Safflower Oil in different regions across the world (Asia, Europe, North America, Latin America, and the Middle East & Africa).

Safflower Oil Price Trend for the First Half of 2024

Safflower oil prices were found to fluctuate throughout the first half of 2024. The US market started the year on a humble note, as the market observed a slight dip in the early months, however, the general outlook remained elevated throughout. Downstream demands from the foods and other consuming sectors witnessed a consistent incline. However, the supply chain curtailments and challenged international trade affected the market trends initially. As the quarter progressed the price trajectory turned upwards again. After the marginal plunge at the beginning, the market’s momentum remained forward-facing for the majority of H1;24.
 

Safflower Oil Price Chart

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Due to increasing demand and regional droughts reducing safflower supply, processors are considering various contracting strategies to incentivize production. The substantial increase in the Minimum Support Price (MSP) for safflower to Rs. 5800 per quintal, as approved by the Indian government for the 2024-25 marketing season, aimed to incentivize production amid reduced supply due to regional droughts. This policy move was part of a broader strategy to boost agricultural output and support farmers by ensuring remunerative prices. Additionally, processors were seen exploring various contracting strategies, such as combining lump sum acreage payments with fixed prices, to manage risk and stimulate production.

Analyst Insight

According to Procurement Resource, short term market analysis suggests a similar trend in the safflower oil market in the upcoming quarter too. Supply factors will remain crucial for driving the market’s fundamentals going forward.
 

Safflower Oil Price Trend for the Second Half of 2023

Safflower oil has a high content of monounsaturated and polyunsaturated fats, making it a popular option for health-conscious consumers seeking heart-healthy alternatives to traditional cooking oils. Its widespread usage in culinary applications, including frying, baking, and salad dressings, also contributes to its market demand. Moreover, the rising popularity of natural and organic food products has boosted the awareness and interest of consumers in safflower oil.

The third and fourth quarters of 2023 witnessed a gradual decline in the safflower oil prices in Asia. Initially, the Indian market experienced a slight relaxation attributed to the government's reduction of import duties, stabilizing prices from previous quarters. However, the combination of low market prices and inexpensive Russian and Ukrainian exports further drove down domestic prices of safflower oil. Additionally, oversupplied markets and reduced demands led to a downward trend in safflower oil prices throughout the aforementioned period, not only in Asia but in European countries too.

In Western Europe, safflower oil prices fluctuated throughout the third quarter. However, the market was able to gain positive growth due to increased international demand, notably from India. In North America, safflower oil prices remained subdued, influenced by the crop's resilience to drought conditions during El Niño and fluctuating domestic demands.

Analyst Insight

According to Procurement Resource, the price trend of Safflower Oil is expected to be dependent on the crop output and trading activities in the next quarter.
 

Safflower Oil Price Trend for the First Half of 2023

Safflower Oil is an edible oil extracted from Safflower flowers through cold pressing. It has a variety of applications, like cooking oil, in cosmetics, resin and polymer industries, cosmetics, etc. The first half of the year 2023 witnessed a fluctuating market trend for Safflower Oil. The first quarter started strong since the feedstock and upstream costs were still high. The global inflation was mounting, and the supply chains were still disturbed.

However, as the trade routes and supply chains started improving gradually, the production and upstream costs started coming down. Other alternative edible oil options also saturated the market, pushing back the Safflower Oil demands. So, the second quarter saw Safflower Oil prices backtracking. Overall, mixed market sentiments were observed.

Analyst Insight

According to Procurement Resource, the Safflower Oil prices are likely to fluctuate in a similar manner in the coming months as well.
 

Safflower Oil Price Trend for the Second Half of 2022

During the said period of the second half of the year 2022, the Safflower Oil market was struggling to compete with other edible oil markets. Mid-July saw the Black Sea deal taking place, which opened the way for Ukrainian agricultural exports to come into the global marketplace. Indonesia also reduced tariffs on palm oil exports. These events resulted in an avid influx of supplies in the global edible oil markets.

So, the Safflower Oil prices struggled to sustain in the competitive edible oil market. However, the limited supply of Safflower Oil was still a concern. Overall, the Safflower Oil market trend remained afloat.

Analyst Insight

According to Procurement Resource, given the slump in downstream demands amidst supply issues, the Safflower Oil prices are likely to remain anchored going further.
 

Safflower Oil Price Trend for the First Half of 2022

The production of safflower is highly volatile, and its planting area depends on the market prices. In 2021, the prices of safflower surged throughout China owing to reduced production, low inventories, and high downstream demand. Due to the record high prices, many medicinal farmers started safflower production in 2022 and hence the production increased, and market inventories expanded causing the prices to decline.

In China, Xinjiang and Yunnan are the two major producers of safflower. In Yunnan, the distribution price in the production area(1 mu) for scattered and bulk goods sold by farmers ranged from 135-140 RMB and the goods used for medical decoction ranged from 144-146 RMB.

The low atmospheric conditions in the early stages of production caused a delay in the peak picking season thereby, inflating the price trend for safflower slightly. However, the prices stabilized and decline further due to the incoming good from Kazakhstan. The current prices of safflower seeds are around 3.8-4 RMB/kg.

The safflower prices registered an oscillating trend which directly influence the prices of safflower oil. Despite the fluctuating raw material prices, the price trend for safflower oil remained anchored in the global market owing to the robust demand for the pharmaceutical and essential oil industry. With the absence of sunflower oil in the market, the prices of other oil soared uncontrollably.

Procurement Resource provides latest prices of Safflower Oil. Each price database is tied to a user-friendly graphing tool dating back to 2014, which provides a range of functionalities: configuration of price series over user defined time period; comparison of product movements across countries; customisation of price currencies and unit; extraction of price data as excel files to be used offline.