[Special Stock] Boratial, Olive Oil as a 'Rare Commodity' Amid Palm Oil Surge... Spain's Largest Olive Oil Partner

[Asia Economy Reporter Hyungsoo Park] Boratial is showing strong performance. The news that Indonesia, the world's largest exporter of palm oil, a representative edible oil, is completely halting palm oil exports due to domestic supply shortages seems to be affecting the stock price. Boratial is a company that imports and distributes processed foods such as pasta, olive oil, and tomato sauce. JC Chemical's price also surged to the limit.

At 10:04 AM on the 25th, Boratial is trading at 17,500 KRW, up 12.18% from the previous day.

According to major foreign media, Indonesian President Joko Widodo has decided to completely ban the export of edible oils and edible oil raw materials, including palm oil, starting from the 28th. This is reportedly due to the ongoing "edible oil crisis" in the country. The price of edible oil in Indonesia rose from 14,000 rupiah per liter (about 1,215 KRW) in early last year to 20,000 rupiah this year, an increase of over 40%. The international price of palm oil surged more than 40% this year due to a sharp increase in demand following the easing of the COVID-19 pandemic and the added impact of the Ukraine war.

The edible oil market is shaking immediately with the news that Indonesia, which accounts for more than 50% of the world's palm oil supply, is cutting off supply overnight. As Ukraine is engulfed in war, sunflower oil from the Black Sea, which accounts for about 80% of the global supply, has virtually disappeared from the market. Some supermarkets in the UK have started limiting the sales quantities of sunflower oil, olive oil, and canola oil.

Boratial supplies Italian food ingredients to hotels, restaurants, and cafes based on an exclusive partnership with De Cecco, the world's top pasta manufacturer. It has achieved continuous sales growth and profitable management through the popularization of authentic Italian food and the growth of the dining-out business. In 2010, it partnered with Lactalis, a world-class dairy group, to supply high-quality dairy products to Costco, E-Mart, Traders, Homeplus, as well as Shinsegae Department Store, Lotte Department Store, Hyundai Department Store, and Galleria Department Store.

De Cecco, founded in 1886 by Don Nicola De Cecco in Italy, is one of the top three Italian pasta manufacturers along with Barilla and Garofalo. Its main products include pasta, olive oil, and tomato sauce. Boratial has maintained a business relationship with De Cecco since its establishment and holds an exclusive distribution contract for domestic sales.

Boratial also maintains a business relationship with YBARRA, established in Spain in 1842. Ybarra is the largest olive oil sales company in Spain. It exports olive oil to over 80 countries worldwide and owns many excellent brands besides Ybarra. Boratial started trading with Ybarra at its inception and has maintained the relationship to this day.

In Korea, demand for olive oil has been increasing since 2013 due to its unique benefits. According to food industry statistical information, the market size grew from 41.2 billion KRW in 2013 to 53.7 billion KRW in 2014 and 55.4 billion KRW in 2015. Research also shows that for health, it is better to enjoy plant oils such as olive oil and consume lard, butter, palm oil, and palm kernel oil as little as possible. The Harvard Medical Publishing, a medical journal of Harvard University, named liquid (plant-based) oils such as olive oil as the healthiest oils. Lard, butter, palm oil, and palm kernel oil were cited as examples of unhealthy oils.