Sunflower oil rises in price following rising prices for soybean oil

Last week, soybean oil finally began to rise in price, although for a long time prices for it remained stable, despite the rapid growth of quotations for palm, and then soybean oil.

The main factor putting pressure on sunflower oil prices remains the threat of Russian military aggression against Ukraine, which may lead to disruption of supplies from the main exporting countries. At the same time, the deterioration of soybean crops in South America leads to an increase in soybean oil prices.

Prices for Black Sea sunflower oil last week increased by 3 30-50/ton to F 1420-1440 / ton FOB. They were supported by the results of a tender in Egypt, where GASC purchased a large batch of sunflower oil at a price of F 1,463/ton FOB, although the purchase price of soybean oil was 1 100/ton higher.

The Buenos Aires Grain Exchange (wage) lowered its forecast for sunflower production in Argentina by 200 thousand tons to 3.3 million tons, which is 2.9% lower than last year’s harvest, although the harvesting rate is better than last year. As of February 16, sunflower seeds were harvested on 24.1% of the area compared to 16.4% a year ago.

Dry weather worsens the condition of soybean crops in Argentina. As of February 16, 31% of crops were in good or excellent condition (37% a week ago and 18% last year), and 23% (17% and 11%) were in bad and very bad condition.

Against the background of a reduction in the supply of South American soybean oil, importers from India, which traditionally buys oil from Brazil and Argentina, last week contracted a record 100 thousand tons of soybean oil from the United States, which led to an increase in quotations.

On this news, March soybean oil futures on the Chicago Stock Exchange on Friday rose 1.2% to 1 1,488/ton, adding 3% in two weeks.

April palm oil futures on the Malaysian stock exchange recovered 2% to 5,539 ringgit/ton or 1 1,324/ton after falling 4.1% on Tuesday at the end of the week, but still remain under pressure from low export rates and falling oil prices.

This week, the market expects a decrease in tension on the borders of Ukraine, which on the one hand will increase demand for sunflower oil, which remains cheaper than soybean oil, and on the other hand will reduce oil prices, which will accordingly affect palm oil quotes.

GrainTrade

Tags: Ukraine, Russia, sunflower oil, soybean oil, prices, Black Sea region, Malaysia, Argentina