The downward correction in oilseeds on the CBoT continued on Wednesday. With the day's losses, the January date marked a four-year low of the equivalent of EUR 338.23 per tonne. The last time such a low was reached was in September 2020. The outlook for meal was also bleak, meaning that losses had to be absorbed here too. Yield prospects in Brazil continue to weigh on the market. In addition, abundant rainfall in large parts of the country has ensured even better growing conditions. A strong soybean harvest is also expected in Argentina. Many traders are also emphasizing that the current exchange rate is making US offers less competitive, which is why many buyers are opting for cheaper offers.
Canola contracts ended Wednesday's trading with another day in the red. January futures fell to 587.70 Canadian dollars per tonne. This means that the bears have taken the lead in the oilseed since the beginning of the week. The equally weaker soybean prices were particularly noticeable on the Canadian stock exchange. Canola exports were also less dynamic in the past week (up to December 8). These totalled 140,000 tons and were thus 50,000 tons below the previous week's figure. Rapeseed on Euronext also recorded significant losses, with the leading dates posting up to double-digit losses. Vegetable oils were also unable to hold their own in the middle of the week. In Kuala Lumpur, palm oil continued its correction and reached a four-week low at the end of the trading day. Concerns about demand unsettled market participants, and many stock market participants also doubt that the Malaysian government will introduce biodiesel with a 40% palm oil content in January as announced. The generally weak market environment reinforced the downward trend.
ZMP Live Expert Opinion
From a fundamental perspective, particularly with regard to potential harvests in the southern hemisphere, oilseeds could continue to fall in the coming weeks. However, the weather and the resulting growing conditions are also causing a degree of uncertainty. If it remains unexpectedly dry in the major growing regions, the market could turn quickly. For the time being, however, it could continue to head south.
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