South American soybean oil fell to a 3-year low

Under the pressure of lower soybean oil prices on the Chicago Stock Exchange and demand from buyers, its spot prices in South America fell below $800/t for the first time since September 2020, S&P Global Platts reports.

Thus, as of February 2, the price of Argentine oil for delivery in March was $792.12/t FOB Up River, which is 6.7% lower than at the beginning of the year.

In Brazil, soybean oil for March delivery fell 8.4% year-on-year to $798.94/t FOB Paranaguá as of February 2, the lowest level since September 1, 2020.

We will remind that in April 2022, against the background of the beginning of the active phase of the war in Ukraine and restrictions on the export of palm oil from Indonesia, soybean oil prices reached $1,900/t, and now they have decreased by more than $1,000/t.

Spot prices are pressured by a decrease in quotations at the Chicago SWOT, where as of February 2, soybean oil futures traded at $986.1/t (-7% for the month). It is worth noting that on February 5, March soybean oil futures rose by $13.3/t to $999.4/t.

Sunvin Group experts believe that the decrease in soybean oil prices at the WTO is due to a reduction in demand from the biofuel industry, as prices for alternative raw materials are significantly lower.

In addition, the recovery of the soybean harvest in South America, particularly in Argentina, which is the world's largest exporter of soybean oil and meal, also led to a sharp drop in world prices.