Category Intelligence on Castor Oil covers the following
Major sourcing destinations for castor oil are India, China, and Brazil. India contributes to about 90 percent of world's production of castor oil, followed by Brazil and China.Global castor oil market supply is 0.6–0.7 Mn T and Brazil's current domestic supply meets only 72 percent of its demand. Higher production and transportation costs had reflected in lower margin for suppliers, propelling the market to an unattractive position for the domestic manufacturers. Consequently, a higher price premium than the existing buyers of the market could give an edge for buying in the domestic market.
Castor oil prices are expected to soar in 2017–2018, owing to the huge gap in supply–demand curve, however, the import market is expected to stagnate this season.Castor oil supply declined by 7 percent and beyond this year, as a reflection of drastic price slumps over 2015–2016. World imports have been observed to be increasing from 2015 by 14 percent in 2015–2016 and 6 percent in 2016–2017, due to fall in prices.Lower prices for castor oil in 2015–2016, due to excess supply, reflected in huge drop in the crop cultivation of 2016–2017 in India, Brazil, China, and other countries.Increasing trend in global consumption of castor oil in the import market has come to a halt this year at 690 Thd T, owing to excess stocks accumulated with higher purchases in 2015–2017
In spite of being one of the major supplying regions, Latin America loses its competitiveness with India, as the region's domestic consumption exceeds the supply.Castor seed production growth targets in Brazil, the key producing country in Latin America, has not been accomplished in 2016–2017 and has declined beyond 35 percent this year.Latin America currently contributes to approx. 25 Thd T of castor oil supply, the world's largest supplier in 1970–1980s. Imports surged in 2016–2017 beyond 50 percent to meet the raising demand in the region.Production in Brazil for castor seed and oil has been curbed over the years, owing to several factors, as in poor yields/ha, higher production costs, and transportation costs.Financial assistance from the government to promote castor cultivation for use of castor oil in biodiesel industry has been terminated, owing to high cost of cultivation. This has further decreased the attractiveness for castor in Brazil
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