Sunflower oil prices continue to rise speculatively

The reduction in sunflowerseeds harvest forecasts in Ukraine and the restraint of sales by farmers are leading to a further increase in sunflower prices. At the same time, processors are taking advantage of the opportunity and selling sunflower oil at high prices against the backdrop of a surge in demand. However, it should be noted that world markets are starting to become saturated with supply, and palm oil quotes are falling sharply due to reduced demand, which will soon reduce speculative demand for expensive sunflower oil as well.

Demand prices for sunflower oil in Ukraine increased by another $20-30/t to $1,250-1,265/t with delivery to ports in November, but the prices offered by factories are around $1,250/t per FCA factory.

Demand prices for Ukrainian sunflower oil with delivery to the EU have increased to $1,340-1,360/t DAP Italy, Greece, although demand prices for Ukrainian rapeseed and soybean oil remain at $1,220-1,260/t DAP Poland, Germany.

Demand prices for Russian sunflower oil increased by $10-20/t to $1,220-1,230/t FOB over the week, supported by a smaller-than-expected sunflower harvest, especially in the south of Russia.

Prices for sunflower oil delivered to India also increased by $20-30/t to $1,340-1,350/t CIF Mumbai during the week.

November palm oil quotes fell 4.4% to 4,317 ringgit/t or $1,022/t in the past 7 days on data on increased production in Malaysia and a decline in export rates. Palm oil exports from the country fell by 0.5-1% in the first 25 days of October compared to the same period in September, although in the first 10 days of October export rates exceeded September by 15-17%, indicating a decline in demand.

December soybean oil futures on the Chicago Board of Trade yesterday fell 1% to $1,107/t (-0.7% for the week), despite a sharp speculative increase in soybean quotes of 4.7% for the week in anticipation of an agreement with China.

The Indonesian Palm Oil Producers Association (GAPKI) said on Tuesday that the country’s palm oil production could rise to 56 million tonnes, exceeding previous forecasts and the USDA’s forecast of 47.5 million tonnes, helped by good weather and high oil prices.

Brent crude oil prices fell 1.5% to $64.5/barrel yesterday amid profit-taking after a sharp speculative rise of 7.6% in the week and expectations of talks between Trump and Xi.

This week, markets will remain in anticipation of the outcome of the US-China talks and the possible signing of a trade deal, which will contribute to the growth of quotes. However, if a deal is not concluded, the speculative price increase will cease.