Lack of demand continues to cool vegetable oil markets
Overheated vegetable oil prices continue to fall under pressure from declining demand for expensive oils, as buyers prefer cheaper types of oils or contract new crop oil at a lower price, forcing sellers to lower spot supply prices.
So, July soybean oil futures, which since the beginning of may have grown on the Chicago SWOT from3 1,380 to.1,500/ton and became the main driver of market growth, have now fallen to. 1,450/ton, and December futures have fallen to. 1,295/ton against the background of accelerating soybean sowing in the United States.
During the rapid growth, soybean oil prices almost reached the level of sunflower oil prices, which continue to fall due to lower demand from India and China. Last week, prices for Ukrainian sunflower oil for delivery in June fell to 1 1,460-т 1,480/ton FOB, but there is almost no demand for it, since buyers are interested in purchasing oil from the new crop at a price of F 1,150/ton FOB.
Despite the decrease in the number of infections in India, quarantine restrictions there will continue for a long time, so we should not expect a recovery in demand for sunflower oil in the near future.
The introduction of a strict quarantine in Malaysia during June 1-14 will increase pressure on the prices of palm oil, the production of which may decrease.
August palm oil futures in Malaysia on Friday rose 2.4% to 4,010 ringgit/ton or 9 970/ton, but overall prices rose only 0.5% in a week, and in two weeks they fell by 12.4%.
On the Dalian stock exchange on Friday, July soybean oil futures rose 2.1% to минулого 1,350/ton, which corresponds to the level of last week, and palm oil futures rose 2.3% to.1,197/ton, which is 5% lower than the level of the previous week.
Lower prices for sunflower oil will increase pressure on neighboring vegetable oil markets, especially soybeans. But the victory in this fight will be won by palm oil, the demand for which will grow against the background of low prices and seasonal increase in production.
