What The War In Ukraine Could Mean For Sunflower Oil
From the price of wheat going up to the closures of American fast food franchises operating abroad, Russia's invasion of Ukraine has already had a major impact on the food industry. And as the war rages on, problems affecting global exports continue to arise; The latest one, according to Agriculture Week, is sunflower oil.
The Black Sea region, which includes Russia and Ukraine, produces approximately 60% of the world's sunflower oil, exporting about 75% of that. However, as ports in the Black Sea have been shut down, plus the potential inability for farmers to plant and harvest their crops due to "farmland [becoming a] battlefield," the global supply of sunflower oil is predicted to drop.
This is bad news for food manufacturers, as before the war even started there was already a sunflower oil shortage. Due to a poor crop in 2021, sunflower prices spiked by $10 since the last season. No longer able to rely on imports from Russia and Ukraine, the food industry's other sunflower oil producers will feel the pressure — and likely struggle to pick up the slack. This increased demand is predicted to lead to even higher prices. John Sandbakken, the executive director of the National Sunflower Association nonprofit, explained to TIME "You're going to see price increases because there's going to be more buyers looking to buy the same oil."
Snack food will get more expensive
When it comes to cooking at home, you probably gravitate more towards olive oil or vegetable oil anyway, while sunflower oil may be barely on your radar. But for manufacturers of consumer packaged goods, sunflower oil is crucial. Just look at the label on any bag of potato chips or other fried snack products and you'll likely see sunflower oil listed as one of the first ingredients. Due to the predicted sunflower shortage, there's a strain on production that has caused some snack food companies to charge more for their products, according to TIME.
U.S. potato chip manufacturer Martin's Snacks shared with TIME that it goes through roughly 45,000 pounds of sunflower oil every 10 days. Though most of the sunflower oil used by companies in the U.S. is sourced domestically, brands still expect to feel the crunch.
While it may seem like the obvious solution is to opt for a different oil, TIME explains that the rise in price for sunflower oil has caused a domino effect on all cooking oils. The most viable alternative, cottonseed oil, is now $0.99 per pound, whereas it used to be half that. Unfortunately for consumers, this means companies reliant on the ingredient will likely continue to raise prices: "the consumer will foot the bill at the end of the day," predicted one U.K. chip manufacturer.