Oilseed prices are showing rapid growth this season against a backdrop of a decline in the world crop of rapeseed and now soybeans in South America. On the one hand, this supports sunflower prices, but on the other hand, they remain under pressure from a bumper harvest and low demand for sunflower oil.
Last week, as a result of the strengthening of the Ukrainian hryvnia against the US dollar by 2%, purchase prices for sunflower in Ukraine fell by UAH 300-400 / t to UAH 20,000-20150 / t ($714-770 / t with VAT) with delivery to the plant for oil content of 48-50%.
Despite the rapid price increase for palm and soybean oil in recent weeks, sunflower oil prices have increased slightly to 1400 USD / t FOB. Processors reduced raw material purchases in anticipation of price adjustments. And the 3-4% drop in palm and soybean oil prices at the beginning of the week indicates that the market is “overheating”.
March soybean futures on the Chicago Mercantile Exchange rose 15.3% to USD 577/t for three weeks on forecasts of a production decline in South America. The market is awaiting the release of an updated USDA forecast and the price adjustments.
The US soybean market is supported by an increase in domestic processing, although export statistics remain lower than last year. Only 37.4 million tonnes were exported, compared to the previous year’s 45 million tonnes. Still, traders are hoping for increased purchases of US soybeans by China in the face of a crop decline in Brazil. At the same time, China is reducing demand for soybeans due to changes in feed formulations and increasing the use of grain instead of soybean meal.
There is also an adjustment on the eve of the new season in the rapeseed market, which rose rapidly in the first half of the season. May rapeseed futures on Paris Euronext fell immediately yesterday by 3.6% or €24.75/t to €677/t or $773.5/t, losing 6.5% of the price from the beginning of the month and 22% from the beginning of the year when they reached a record €828/t.
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