Safflower Oil Prices Explained

Safflower oil prices largely benefitted the growing global consumption of alternative vegetable oil and the plant’s handy farming process. Also, the soaring sunflower oil prices because of lower yields in the Black Sea area prompted consumers to shift their purchases to safflower oil.

Moreover, the rising application of high-oleic oil in the skin care and hair care industry boosts the sales of safflower oil in the market. Furthermore, consistent downstream demand from the food sector, particularly in the U.S. witness progressive trend, influencing volatility in the market.

Why are safflower oil prices fluctuating?

1. Competition with Other Edible Oils

Supply, demand, availability, and price fluctuation of alternative vegetable oils largely determine the price of safflower. The shifting customer tastes toward healthier or more adaptable oils contribute to safflower price variation.

Also, the increasing preference for vegetable oils over unhealthy variants makes the competition and marketability of these commodities even fiercer. For instance, the North American and European regions registered increased inquiries for commodities that have high-oleic properties. 

2. Supply and Demand

Safflower oil or its derivatives become more expensive when demand for it exceeds supply because purchasers become more competitive.

On the other hand, an oversupply of safflower available in the market lowers its demand as sellers drop their prices by adjusting their value to attract customers and avoid piling inventory.

For instance, the consecutive decline of Kazakhstan’s safflower production due to unfavorable weather conditions resulted in a 3.5% global increase in safflower prices. 

3. Global Market Trends

Health trends or dietary choices largely influence the demand for safflower oil and other safflower-derived goods.

Additionally, economic variables, geopolitical events, or changes in global trade dynamics hold the supply and pricing of safflower on the international market.

For example, safflower prices surge in the Asia Pacific as Japan and China ramp up their safflower seeds and oil imports. 

4. Export and Import Trends

When there is an excess of safflower in the receiving country due to market oversupply, there is a chance that imports will drive down prices.

On the other hand, exporting lowers domestic supply in the exporting nation, leading to higher domestic safflower prices.

For instance, the price per kilogram of safflower exported from the United States decreased by 6.02% due to the increased supply from Mexico and the country’s improved production.

Which variables impact the price of safflower oil?

• Competition with other Edible Oils
• Supply and Demand
• Global Market Trends
• Export and Import Prices
• Weather Conditions
• Government Policy

Where does safflower oil come from?

Safflower is a bushy plant with either spineless or spine-filled egg-shaped leaves. Additionally, this plant is primarily grown in North American and Middle Eastern nations where its seeds are used as fruits.

There are two main safflower varieties, one that produces seeds high in monounsaturated fatty acids and the other in polyunsaturated fatty acids. Furthermore, it is harvested once the flowers are dried up and the seeds are matured.

The process of harvesting safflower involves several steps:

1. Timing of Harvest – The harvesting season for safflower is very important as premature harvesting results in undeveloped seeds, which lowers yields and reduces oil content. On the other hand, late harvesting causes the seeds to break and fall to the ground.

2. Cutting the Plants – The plants are typically trimmed down close to the ground for harvesting once it turns out that the safflower crop is mature.

3. Drying – The safflower plants are left in the field to dry after being trimmed as it is crucial to reduce moisture content from the seeds which is important in the oil extraction process.

4. Threshing – The process of threshing involves removing the seeds from the remaining plant material. Also, it is done mechanically with threshers or traditionally by beating the plants.

5. Winnowing – After threshing, the mixture of seeds and chaff is winnowed to further separate the seeds from any leftover material.

6. Cleaning – Next, the separated safflower seeds go through a cleaning process to remove any remaining impurities or foreign material.

7. Storage – Then, the safflower seeds are cleaned and are ready for storage or further processing.

What are the uses of safflower oil?

High oleic safflower oil has health benefits, including lowering the risk of cardiovascular problems due to its high level of omega-3 and omega-6 fatty acids.

Additionally, this oil is flavorful and aromatic, making it ideal for use in several food applications. Furthermore, it is used as a spray oil for dried fruits, a liquid flavor dispersion, or as a component of dietary supplements.

Here are the top industrial applications of safflower:

1. Edible Oil Production – Safflower seeds are rich in oil and are useful in many different types of cooking and culinary applications. Also, its high smoking point makes it ideal for deep-frying and frying.

2. Dyes and Coloring – Its petals contain natural colors that are used in place of artificial dyes. The culinary and textile industries both use the red and yellow dyes that are extracted from safflower.

3. Cosmetics and Skincare – Safflower oil is highly valued for its moisturizing properties and is commonly used in formulations such as lotions, creams, and hair care products.

4. Pharmaceuticals – The pharmaceutical industry utilizes its oil to make dietary supplements and medications.

5. Animal Feed – Safflower meal is a high-protein component of animal feed that is especially beneficial for feeding chickens and cattle.

6. Biodiesel Production – Biodiesel can be produced using safflower oil as a feedstock, offering a sustainable and environmentally beneficial substitute for regular diesel fuel.

What is the future price of safflower oil?

The global consumption of safflower oil is experiencing rapid growth due to increasing health awareness among consumers worldwide. As a result, the demand for high-oleic safflower oil in personal care products drives a surge in the safflower seed oil industry, with the United States leading the worldwide market due to the emerging trend of low-fat diets and changing lifestyles.

For example, Avoskin company introduces its handmade soap and cosmetics from safflower oil to promote natural beauty with high-quality products.

Also, industrial lubricants study the potential of safflower oil as a sustainable substitute for oil-greasing applications. Furthermore, the growing scale of bio-based practices is another market factor of this commodity as it’s a good alternative to palm and crude oil.

For instance, Qantas Airlines announced plans to purchase 10 million liters of sustainable biobased aviation fuel (including safflower oil) as part of the company’s commitment to net zero emissions by 2050.

Thus, the price of safflower will be $5.11 per kilogram in 2027 and its market is forecasted to reach $359 million by 2033 with a 4.5% CAGR.