Lewis says that 50%-60% of the rapeseed grown in Europe, and 60% of the palm oil imported by the region, goes into biodiesel. “Over the last 20 years the increase in demand for biodiesel has stimulated production but there is always going to be a crunch point where you get the debate over fuel versus food,” he says.

Biofuels account for about 15% of global demand for vegetable oil, according to Rabobank. This use, as countries seek to reduce their reliance on fossil fuels, has previously been blamed for pushing up food prices. The EU-27 is set up to import record volumes of rapeseed and sunflower seeds (SFS) in the 2022-23 marketing year, having already received a respective 6.19mn t and 1.98mn t of products, with Ukraine and Australia being the major suppliers. This, coupled with a near record rapeseed crop in the bloc in 2022-23, has led to an oversupply in European vegetable oil markets, heavily weighing on RSO prices. Ariel Brunner, head of EU policy at BirdLife International, an environmental NGO, recently told New Scientist: “We are literally burning a hell of a lot of food.” Governments had the power to change this because the biofuel market was entirely driven by subsidies, he added.Difficulties for exporters continued in the immediate aftermath, with the port of Pivdennyi -- one of the three ports covered by the agreement -- remaining inactive, in the absence of approvals for incoming ships. European SFO prices have already bottomed out and their rebound would only continue, according to one European vegetable oil trader interviewed by Argus, owing to higher demand from food and biofuel industries, while rapeseed and SFS production are expected to remain relatively unchanged on the year in the next season. And Argentina has lost more than half of its soybean production this year because of drought, which the global vegetable oil market will feel at some point later on.

We haven’t put our prices up yet but we are thinking about it,” says Khan, who says increases of 10% to 15% will be required this month to cover his restaurant’s higher running costs.

India slows palm oil imports as prices rally amid negative margins

The price of Ukrainian sunflower seeds decreased on the week on May 30, according to a producer, with values seen at Hryvnia 12,500-13,200, including VAT, on a CPT plant basis. The loss of Ukraine and Russia’s sunflower oil could be mitigated by diverting crops away from fuel tanks. This would help to reduce food prices, a move that would benefit those on the lowest incomes the most. External policies also weighed on Ukrainian sunflower oil prices, as key destinations for both oil and oilseeds attempted to limit cheap inflows to protect domestic industry. Market demand for Ukrainian shipments weakened in response, with trades for Russian origin product on a CIF Turkey basis reflecting a shift towards more secure transportation routes for some consumers.