World vegetable oil prices rose after the US-China duty agreement, but sunflower oil was not affected

Over the weekend in Switzerland, representatives of the United States and China agreed to reduce tariffs by China on American goods to 10% and by the United States on Chinese goods to 30%, which added optimism to markets that were expecting a global recession and a collapse in world trade.

July Brent crude futures rose 7.3% to $66.6/barrel (+4% month-on-month) on expectations of a recovery in oil demand following improved relations between the US and China.

Following oil prices, soybean and palm oil quotes began to rise. July palm oil futures on the Bursa exchange in Malaysia rose 2.07% yesterday to 3,893 ringgit/t or $908.5/t (+2.7% for the week), but further growth was limited by data on increased production and inventories.

According to the Malaysian Palm Oil Board (MPOB), in April, crude palm oil production increased by 21.52% compared to March to 1.69 million tonnes, while exports increased by only 9.62% to 1.1 million tonnes, resulting in oil inventories rising by 19.37% to a 6-month high of 1.87 million tonnes.

According to surveyor Intertek Testing Services, palm oil exports from Malaysia fell by 9% between May 1 and 10 compared to the same period in April, and will continue to slow.

July soybean oil futures in Chicago rose 6.4% over the week to a seasonal high of $1,134/t (+9.6% over the month) on expectations of renewed soybean exports to China and reduced supply in the US domestic market due to increased processing.

According to Oleoscope, the price for May deliveries of soybean oil in Brazil is $1,063.66/t FOB, and in China’s Daylian it is $1,106.67/t.

Palm oil prices are already $100/t lower than soybean oil, which will increase demand for it in the future. At the same time, sunflower oil prices remain stable. The increase in exchange prices for soybean and palm oil has not yet affected prices on the physical market, where the supply of soybean and sunflower oil from Argentina and Brazil is increasing.

In Ukraine, export prices for sunflower oil remain at $1,110-1,115/t delivered to Black Sea ports. They are pressured by increased sunflower offers and a drop in prices for Russian oil for delivery in May to $1,110/t FOB. Prices for sunflower oil for delivery in May to India are $1,194/t CIF Mumbai, which reduces demand.

Ukraine increased its sunflower oil exports in April compared to March by 9% to a 5-month high of 478 thousand tons, which was the lowest figure for this month in the last 3 seasons.

Over the 7 months of the 2024/25 MY, the Russian Federation increased its share in the volume of sunflower oil imported by India compared to the same period of the previous season from 36% to 65% or 1.16 million tons, Ukraine – from 7% to 22%, while Argentina reduced it from 16% to 7%.

Tags: soybean oil, prices, palm oil