The soaring cost of cooking oil is affecting both the cost and availability of food worldwide. Before the Russian attack on Ukraine, cooking oil prices were already approaching all time highs. Now there are shortages, purchase limits and policy restrictions in numerous countries.
A recent article said that thousands of fish and chips shops in England may have to shut down.
What are the causes of the soaring cost of cooking oil?
Growing demand for food
As nations like China become wealthier their population demands more and better food which translates into more demand for cooking oil. A constrained supply coupled with higher demand
Is a perfect combination for higher prices and shortages. Supermarkets in the UK, Spain and Italy have already placed purchase limits on cooking oil due to shortages. There have been protests in Indonesia over the availability and price of cooking oil. Demand for rapeseed has skyrocketed as Chinese traders scour the world to meet the demand for food from a large and growing population demanding better and more modern foods.
Droughts, brought on by climate change have reduced the yields of crops used to manufacture cooking oil. A drought in Canada negatively impacted the high cost of cooking oil due to lower production of rapeseed in 2020/2021. Droughts in South America have driven the high cost of cooking oil higher by constraining the production of soybeans.
The pandemic temporarily reduced the demand for cooking oil but exacerbated supply issues through the disruption of supply chains and strained labor markets. Malaysia produces 25% of the world’s supply of palm oil but production has been constrained by pandemic induced labor shortages.
Indonesia produces nearly 60% of the world’s supply of palm oil. In the face of potential shortages the Indonesian President banned exports of palm oil to insure Indonesians had sufficient supplies, driving up further the high cost of cooking oil. According to the WWF palm oil is so widely used that it is in 50% of all packaged foods sold in supermarkets along with deodorant, shampoo, toothpaste and lipstick. The world has made very little progress in moving to sustainably raised palm oil. Current practices result in massive deforestation contributing further to climate change.
Ukraine produces half of the world’s supply of sunflower oil and Russia one quarter of the worlds’ supply. The Russian attack on Ukraine has severely disrupted the supply of sunflower oil from those nations. Sunflower oil is widely used in restaurants and households in Europe.
England has restricted the quantity of cooking oil individuals can buy leading to hoarding.
What can restaurants do about the soaring cost of cooking oil?
This perfect storm of conditions will not recede quickly even if the war in Ukraine abates. But there are ways for restaurants to mitigate these price hikes.
- Filter their oil regularly. Cleanfry offers closed-loop systems that automatically filter your oil.
- Polish their oil. Polishing chemicals remove impurities and lengthen oil life.
- Do not season over the fryers.
- Rest the oil when not in use. Turn off the fryers.
Collectively, these steps can save a restaurant more than 50% on the price of cooking oil.