Palm and soybean oil futures rose 8.5-10% in two sessions, following soybean prices

A downgrade in US soybean acreage estimates shocked the market and sent palm oil prices up 8.5% and soybeans up 10% over the past two sessions.

September palm oil futures on Bursa Malaysia rose 5.1% yesterday to a 3-month high of 3,985 ringgit/t or $854/t (+8.5% over two sessions) amid Friday’s gains for soybeans and soybean oil on the Chicago Stock Exchange.

The speculative jump was not restrained even by the data of the survey company Intertek Testing Services on the decrease of palm oil exports from Malaysia in June by 6.9%.

On the exchange in Chicago, starting from Friday, July futures rose in price:

• for soybean oil – by 10% to $1,400/t (+9.7% for the week, +29% for the month),
• for soybeans – by 5.4% to $574/t (+2.8%, +15.7%).

It’s worth noting that soybean oil quotes rose stronger as U.S. soybean inventories as of June 1 were 17% lower than last year, so processors have already started importing soybeans from Brazil to load capacity and lower production costs.

On the Chinese stock exchange in Dalian, soybean oil contracts rose by 6% yesterday, and palm oil contracts by 4.9%.

A sharp rise in soybean and palm oil prices supported sunflower oil prices, which rose 1.7% yesterday to $895/t delivered to buyers, adding 7% to the price for the week.

Refinements have reduced sales of sunflower oil in anticipation of a further rise in vegetable oil prices, but the significant volume of rapeseed and sunflower oil offers on the EU market does not allow us to hope for a significant increase in demand from European buyers, while deliveries of Ukrainian sunflower oil to India and China are impossible due to the blockade Black Sea ports.

Tags: prices, soybean, India, palm oil, USA, China, soybean oil