Palm and soybean oil quotes continue to rise amid active speculative demand

Following a sharp rise in soybean oil prices in Chicago, palm oil continued to rise on forecasts of production cuts in Malaysia and data on increased exports.

 

December palm oil futures on Bursa Malaysia rose 3.7% on Friday to their highest since June 30, 2022 at 4,868 ringgit/t or $1,113/t (+5.7% for the week, +14 .4% in two weeks).

 

Forecasts of reduced production and increased exports in October strengthened speculative demand, especially against the background of expected reductions in sunflower oil production.

 

According to surveyor Intertek Testing Services (ITS), in October, compared to September, Malaysia increased exports of palm oil products by 14.5% to the highest level since October 2020 of 1.55 million tons. Final data on production, exports and stocks of palm oil oil in Malaysia will be released on November 10, but traders expect further reductions in stocks.

 

December soybean oil futures on the Chicago Stock Exchange rose 8.1% in three sessions to the highest level since July 2024 at $1,020/t (+4.8% for the week and month) on the back of increased demand for the cheapest oil market.

 

Last week, India stepped up purchases and bought 150,000 tonnes of soybean oil, prices of which remain lower than palm and sunflower.

 

Oil prices at the end of the week resumed speculative growth on the news that Iran is preparing to strike Israel from the territory of Iraq in the coming days.

 

The soybean oil market is awaiting the US election, as the positions of Democrats and Republicans on supporting biofuel production are different. Uncertainty over US biofuels policy and the lack of guidance on the new Clean Fuel Tax Credit is forcing biofuel producers to postpone soybean oil purchases until early 2025.