Restructuring Vegetable Oil Supply and Demand in Asia: The Impact of Trade Liberalization Facilitating Increase of Fat Supply Among Asian Nations While Jeopardizing Their Domestic Production

Wednesday, July 16, 2014: 11:18 AM
Room: Booth 61
Oral Presentation
Midori HIRAGA , Graduate School of Economics, Kyoto University, Kyoto, Japan
Shuji HISANO , Graduate School of Economics, Kyoto University, Kyoto, Japan
This research examines strategy shift in vegetable oil sector among global transnational corporations, focusing on Asian TNCs like Japanese sogo-shosha and food industry, together with related trade liberalization and deregulation policies of Asian countries in the Corporate Food Regime (McMichael, 2005). These shifts are assumed to be increasing Asian countries' dependency on global vegetable oil, which can jeopardize their food security as the global oil supply increasingly depend on only two crops, oil palm and soybean, produced in the limited number of countries. The shifts also can jeopardize public health of the Asian population by increasing availability of oils and fats in the nations' diet as a forerunner of nutrition transition.

Asian countries have rapidly increased vegetable oil supply in last few decades. China and India transformed from mostly self-sufficient countries of vegetable oils into the global leading importers by rapidly increasing imports of palm oil, and of soybean in case of China, since the mid-1990s. Thailand and South Korea have increased their vegetable oil supply, mainly with palm oil and soybean oil, after the financial crash in 1997. Japan liberated its vegetable oil supply decades ago and reduced its self-sufficiency rate as low as 2%. More significantly, recent neoliberal trade liberalization, especially direct foreign investment and corporatization, are suspected to be facilitating (re)structuring of the supply chains of vegetable oils with development of food industry based on imported vegetable oil and oil crops, like building large-scale oilseed crushing facilities or developing instant noodle industry in China. The increased availability of oils and fats, and the concurrent change in diet toward higher-fat, lower-carbohydrate, more processed food, can jeopardize the public health among Asian nations. This research investigates the structural changes in vegetable oil supply and demand in Asia, in order to secure food and health of the population.