The vegetable oil markets expect higher demand from China

Oil World Analysts believe that after the sharp decline in China's imports of soybeans from the United States, it will increase the volume of purchases of vegetable oils and meals in the world markets. Now soy in China actively supplied from South America, but there is not available resources are not enough to fully replace supplies from the United States.

If the import of soy from the US will not recover, then in November 2018 – January 2019 total soybean imports to China decreased in comparison with the previous season's 11 million tons.

the Reduction in the import of soybean will lead to a fall in domestic production that must be compensated by increasing imports of meal. The balance of demand and supply of meal in the domestic market of the PRC will be very stressful. Soybean imports to China will resume in March 2019 when the South American country will begin selling the new soybean crop.

it is Expected that in order to avoid shortage of vegetable oils soon China is stepping up buying soybean oil, rapeseed oil, sunflower oil, and to a lesser extent palm, because the low temperature is complicated by its transportation.

as a result of the decline in October exports of palm oil from Malaysia in comparison with September by 14%, quotation on the stock exchange in Kuala Lumpur yesterday fell 1% to a 3-tigresas low of 514 $/t. overall in October, the price lost 1.1%.

After the US refused to buy Iranian oil, the price of Brent crude recovered to 76 $per barrel, that supported prices in the soybean complex.

Experts expect that the increased demand from China on the Ukrainian sunflower oil and meal, will support prices, which have recently declined. After the fall of demand prices for sunflower oil from India to 690 $/t CIF, in Ukraine it fell to 645-655 $/t FOB for shipments in November – December.