The oilseed market is caught between comparatively stable palm oil prices at a high level and the sharp drop in crude oil prices and weak soybean prices. In this interplay, rapeseed prices are holding relatively firmly to the line slightly above the € 450/t mark.
Palm oil prices, the market leader in the vegetable oil sector, are only slightly weaker at just below the € 800/t threshold. Although production in Indonesia and Malaysia, which together account for over 85% of production, is heading towards the peak of annual production in Oct.24, the growth rates that were previously usual remain comparatively low. In addition, Indonesia is increasing the higher blending percentage of the biofuel produced, resulting in reduced palm oil exports.
Crude oil prices have fallen sharply. Although inventories have fallen somewhat, OPEC's announcement in Oct .24 to increase oil production again is the decisive factor. However, it remains to be seen whether the intention will actually be implemented. The Houthi attacks on tankers in the Red Sea and the tensions between Iraq, Hamas and Israel are also causing uncertainty.
The prospects of a high US soybean harvest are increasingly confirmed by the latest field inspections by a group of US farmers. In addition to the already extensive area under cultivation, above-average yields per hectare are expected. This is putting further downward pressure on stock market prices in Chicago.
Rapeseed prices on the Paris stock exchange remain comparatively stable above the € 450/t line. In Winnipeg/Canada, a similar observation can be made for canola. The oil-rich fruit is receiving strong support from the favorable palm oil prices. The weak soybean prices are having a comparatively minor impact.
ZMP Live Expert Opinion
The submarkets in the oilseed sector are supplied in completely different ways in some cases. There is a global shortage of rapeseed, which is particularly evident in the EU. In the soybean market, the global supply trend is far above average. The crude oil sector, with its impact on the biofuel market, is highly unsettled by political and military actions. Rapeseed prices are holding surprisingly stable, while soybean prices continue to be weak.
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