Palm oil fell by another 10%, which increased the pressure on sunflower prices in Ukraine
After the collapse of palm oil prices on Monday by 9.5% yesterday, quotations fell another 10.7% to a 6-month low, which increased pressure on neighboring markets for soybean and sunflower oil and led to another drop in sunflower prices in Ukraine.
The projected recession in the world economy will reduce oil prices and imports of vegetable oils to China, and Indonesia's permission to export nearly 1 million tons of palm oil has already lowered its prices.
After speculative growth to 7,000 ringgit / t due to a ban on exports from Indonesia in late April, August palm oil futures on the Malaysian stock exchange Bursa fell 10.7% yesterday to a six-month low of 4499 ringgit / t or 1022 $ / t, losing two weeks 38% of the price against the background of oversold market. The market is returning to acceptable price levels for buyers, and hopes to intensify China's procurement.
In May, compared to May 2021, China reduced the import of vegetable oils by 2.2 times to 533 thousand tons, including soybean - from 130 to 9 thousand, sunflower - from 126 to 16 thousand tons, palm - from 559 to 258 thousand tons , rapeseed - from 216 to 117 thousand tons. From January to May, imports of vegetable oils decreased by 3.5 million tons or 58% to 5.19 million tons due to too high prices caused by prolonged quarantine in China and Russia's war against Ukraine.
At the Dalian Stock Exchange yesterday, futures for soybean oil fell by 5.1% and palm - by 3.8%.
On the Chicago Board of Trade, soybean oil futures fell 4.1 percent to $ 1,555 a tonne yesterday, losing 17 percent in two weeks amid completion of sowing and good U.S. crops.
The collapse of vegetable oil markets has reduced demand for sunflower oil, although supplies from Ukraine remain limited due to port blockades, and Russia has difficulty making foreign exchange settlements and has seen rising freight rates from its ports.
ICAR reports that there is no export demand for Russian sunflower oil, as most buyers have switched to cheaper Indonesian palm oil and Turkish consumers are trying to buy cheap oil from Ukraine. Demand prices for Russian oil fell to $ 1,570 / t FOB, while supply prices are $ 1,750-1800 / t FOB Black Sea ports.
In Ukraine, demand prices for sunflower oil fell to 1400-1550 $ / t DAP Poland, Romania, Bulgaria. Against the background of lower prices for vegetable oils, demand prices for sunflower this week fell by 1000-2000 UAH / t to 12500-14500 UAH / t with delivery to the plant. Farmers are holding back sunflower sales, preparing for the new harvest and looking for additional storage facilities.
The fire caused by rocket strike at the Avery terminal in Nikolaev destroyed 70 thousand tons of sunflower oil stored in port. This confirms that Russia continues to destroy its competitor in the supply of agricultural products, including sunflower oil.