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  • Unconventional Ag

Russia May Limit Use of Palm Oil in Food Production

Russia’s Deputy Prime Minister Arkady Dvorkovich was quoted last week by TASS news agency saying Russia is considering imposing limits on the use of palm oil in food production. There has been no indication as to why such limits would be imposed but restrictions may include tightening the use of tropical oil and greater transparency in the sector, according to the quote by Dvorkovichis.

The use of palm oil in food production has likely been brought to light by the recent increase in use of cheaper raw materials, including palm oil, by domestic food producers. Since Russia’s sanctions on most Western food imports, imposed in August 2014, food producers there have been looking for ways to cut costs.

Andrey Sizov, the head of SovEcon agriculture consultancy, told Reuters, that Russia has already imported more palm oil this marketing year (beginning Oct. 1) than in all of last year. He argues however, that increased palm oil imports are not a result of sanctions on Western imports but due to a relatively high domestic price for sunflower oil this year, making imports of palm oil, which primarily come from Indonesia and Malaysia, more competitive.

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