Collapse in soybean oil quotes and the decline in palm oil prices continue to put pressure on sunflower oil prices

Global vegetable oil prices remain under pressure from increased soybean oil supply and lower oil prices, which are limiting demand from the biofuel industry and reducing prices. Good weather is supporting the development of rapeseed crops, which could increase rapeseed oil supply as early as next month.

In recent months, the main driver of prices has been Chicago soybean oil quotes, but over the past 7 days, July SWOT soybean oil futures have completely lost the previous week’s growth and fell by 4.8% to $1,650/t (+1.5% month-on-month) against the backdrop of a collapse in soybean quotes and an increase in supplies of soybeans and soybean products from South America. The lack of Trump’s promised increase in exports to China is returning soybean quotes to the levels of last fall. July soybean quotes fell by 10% to $410/t over the month, and are trading at the level of early February.

Soybean oil prices in Daylian (China) for June delivery decreased by $15-20/t to $1,235-1,240/t in a week, while on the spot market, soybean oil prices in Brazil fell by $40-50/t to $1,210-1,240/t FOB, and in Argentina – by $20-30/t to $1,180-1,220/t FOB.

Soybean oil prices in Europe also decreased by $40-50/t to $1,250-1,260/t FOB Rotterdam.

July palm oil futures on Bursa Malaysia were trading at RM4,528/tonne during the week, but dollar prices fell 1.7% to $1,116/tonne due to a stronger ringgit as the market is under pressure from reduced exports. Local surveyors estimate that Malaysian palm oil exports fell 8.8% to 15.5% month-on-month in May. The Malaysian Palm Oil Board is expected to release its monthly supply and demand report today, with inventories expected to rise again. Falling oil prices will also put pressure on palm oil prices.

August Brent crude futures fell 4.9% to $91.5/barrel during the week on Trump’s promises to conclude a deal with Iran in the near future, despite the military escalation between Iran and Israel with the US in the past few days.

Over the past week, sunflower oil bid prices in India remained at $1,410-1,420/t CIF Mumbai, but Russian sunflower oil bid prices fell by $10-15/t to $1,285-1,290/t FOB, while Argentine oil prices fell to $1,250-1,280/t FOB due to a sharp 32% drop in sunflower oil demand from India in May .

Demand prices for Ukrainian sunflower oil delivered to Black Sea ports decreased by $5-10/t to $1,320-1,325/t in a week, but there is a supply shortage on the market, as new shelling of oil extraction plants occurred last week.

The supply of sunflower oil in Ukraine is decreasing, as a limited number of plants continue to process sunseed, and a significant number of enterprises have begun prevention and preparation for the new rapeseed season.

Tags: prices, palm oil, sunflower oil, soybean oil