Latam soybean oil basis jump

Argentina and Brazil’s FOB soybean oil basis levels rose to more than two-month highs, amid steady demand for exports and local biodiesel blending as well as transportation bottlenecks in Paraná river.

S&P Global Platts on Aug. 5 assessed the Argentinian FOB Up River soybean oil basis for September shipment at minus 500 points to the correspondent Chicago Board of Trade contract. It was the highest level for front-month loading since minus 500 points on May 27 and far above minus 1,500 points June 9-10.

The Brazilian FOB Paranagua basis, which reached minus 370 points to CBOT Aug. 5, also touched the highest since minus 300 points on May 11. This compared with the record low of minus 1,400 points on June 9-10.

Multiple factors were contributing to the firmness in Argentina and Brazil markets, even with CBOT futures still at a high level of above 60 cents/lb.

In Argentina, a resurgence in export demand for soybean oil and biodiesel, even though at a slow pace, was seen as supportive. This came while traders rearrange their upcoming commitments amid shallowness in the Paraná river, a vital artery for the country’s agricultural trade flow.

Since the beginning of July, more than ten trades were confirmed in the Up River paper market for loadings between August and Q4 2021.

Hellenic Shipping News

Tags: Аргентина, Brazil, soybeans, biodiesel, logistics, soy oil, demand