Vegetable oil prices rose slightly after falling in the previous week

Vegetable oil markets remain under pressure from uncertainty over future price trends, although fundamentals point to a decline in demand, but traders are hoping for higher quotes due to reduced sunflower oil supply.

 

Palm oil prices recovered last week and supported soybean and sunflower oil prices, although rapeseed oil prices remained under pressure from rising supply.

 

The main reason for the speculative increase in oil and vegetable oil prices was drone attacks in the Black Sea on sanctioned tankers carrying Russian oil, as well as an attack on a Russian vessel carrying Russian sunflower oil.

 

According to the Turkish Ministry of Transport and Infrastructure, the Midvolga 2 tanker, which was heading from the Russian Federation to Georgia with sunflower oil, was attacked 130 km from the Turkish coast. It did not ask for help and continued its movement towards Sinop with its engines running. There was no threat to the lives and health of the 13 crew members.

 

December palm oil futures FCPO1 on Bursa Malaysia rose 4.2% to 4,159 ringgit/t or $1,007/t for the week, recovering a 5.9% drop the previous week, despite a slowdown in November exports and a rise in production. The official data is due on December 10, and the market expects further increases in Malaysian palm oil inventories. However, traders are hoping that the situation will change in December due to seasonal production cuts and Indonesia will increase the palm oil content in fuel from 40% to 50%, which will reduce exports.

 

February Brent crude futures traded at $62.5/barrel during the week (-3% for the month), expecting progress in the US-Russia negotiations to end the war.

 

December soybean oil futures in Chicago rose 4% for the week, reversing a 3.8% decline in the previous week, and are now trading at $1,160/t (+4.8% for the month).

 

The price of soybean oil in Brazil rose by $20/t to $1,130-1,140/t FOB in a week, but the price of soybean oil in China rose by only $10/t to $1,170-1,175/t Daylian due to ample supply.

 

Prices for sunflower oil delivered to India increased by $10-15/t to $1,315-1,325/t CIF Mumbai during the week, and prices for Russian sunflower oil (delivered in December) increased by $5-10/t to $1,210-1,215/t FOB during the week.

 

Demand prices for sunflower oil in Ukraine (with delivery to ports in December) remained at $1,230/t during the week, and the number of offers from producers is increasing.

 

EU rapeseed oil prices traded at $1,260-1,265/t FOB Netherlands during the week amid an increase in the forecast for the rapeseed harvest in Australia.

 

According to the European Commission's forecasts, in the 2025/26 MY, EU countries will reduce imports of vegetable oils by 19% compared to the previous season to 5.6 million tons, in particular palm oil - by 26% to 2.5 million tons, sunflower oil - by 10% to 2.3 million tons, soybean oil - by 28% to 0.5 million tons, while rapeseed oil imports will remain at the level of 0.3 million tons.

 

According to Patanjali Foods Ltd., one of India’s largest buyers of vegetable oils, local importers have purchased over 150,000 tonnes of soybean oil from South America for delivery from April to June 2026. This was facilitated by a discount of $20-30/t for soybean oil compared to palm oil, although soybean oil is usually $70-100/t more expensive than palm oil. This indicates a willingness of sellers to lower prices in anticipation of a large harvest in South America in the new season.