Food Crisis is Back: Cooking Oils Supply Ultra Low; Prices To Rise

Blame it on the Chinese's new found love for processed food? Cooking oils are used to make everything these days from candy bars to "healthy" margarine, to biofuels.

Stocks have declined to the lowest in two generations as demand is expanding at five times the pace of the world population. Oil production cannot keep up.

The U.S. Department of Agriculture data shows that inventories of soybean, rapeseed, sunflower and six other oils will drop to less than 29 days of consumption this year. This is the lowest since 1975.
The very popular Palm oil, will rise 8% to $1,100 a metric ton in Malaysian by the end of the first quarter, the highest since March.
A United Nations report published Nov. 3 says supplies of oils and fats will be near the same critically low level seen during the 2008 food crisis,.
Says Peter Thoenes, an economist at the UN Food and Agriculture Organization in Rome: "This is an early warning that we're giving," "A tightening in the global supply and demand balance seems inevitable. The oil-crop market fundamentals seem to call for continued firmness in prices."