Vegoils commentary: CME soyoil spikes on planting intentions, firmer crude
Futures across the soybean complex had a choppy trade in Chicago on Thursday March 28, with some upward support reported after the US Department of Agriculture released its planting intentions report.
The May soyoil contract on the Chicago Mercantile Exchange (CME) was up 0.9% on the day at the time of publication, trading at 48.09 cents per lb.
The market had a choppy trade, with front-month soyoil contracts rising and falling as much as 1% during the session.
Some underlying support came after the USDA’s planting intentions report showed soybean acreage estimates down from 87.5 million acres in February to 86.5 million acres, within market estimates.
Estimates are still calling for a 3% year-on-year increase in acreage, but helped support prices across the soybean complex, which also borrowed strength from a steep surge in corn and wheat prices, both underpinned by the USDA report.
Soyoil prices were supported further by spiking crude quotations, with Brent and WTI contracts up 1.1-1.8% on the day.
The USDA also released its grains stocks report, with soybean stocks as of March 1 reported at 1.85 billion bushels (50.3 million tonnes), up by 9% from March 2023 and above analyst expectations of 1.83 billion bushels.
Higher-than-expected soybean stocks capped gains across the complex.
Malaysian palm oil futures trading was halted for a bank holiday, returning on Friday March 29.
Weekly net export sales of soyoil were slightly bullish for prices, totaling 6,000 tonnes with weekly shipments at 7,700 tonnes, while soymeal net sales missed market expectations at 127,300 tonnes.
Soymeal futures were broadly unchanged on the day, with May CME contracts trading at $339 per short ton at the time of publication.
The cash market in South America was muted on Thursday, with few bids and offers reported.
The Argentinian basis for May loading was assessed at a discount of 7.25 cents per lb to CME May futures, unchanged from the previous assessment.
The same basis in Brazil was assessed at a discount of 6.25 cents per lb to May futures, up by 0.75 cents per lb day on day.
Brazilian soymeal basis for May loading was seen at a premium of $1.50 per short ton to underlying futures, up $1 per short ton from Wednesday.
In Argentina, the same basis rose by $1.50 per short ton and was assessed at a premium of $5.50 per short ton to May futures.
Rapeseed oil in European ports on Thursday was offered at €928 ($1,004.42) per tonne FOB Rotterdam against the buyer’s idea of €903 per tonne FOB Rotterdam, shipment in April-May, which is on average €7-10 per tonne more expensive than the day before.
Rapeseed oil for August/September/October loading traded at €907 per tonne FOB Rotterdam and €915 per tonne FOB Rotterdam for November/December/January shipment.
Sunflower oil with May loading was offered in six European ports at $950 per tonne FOB against the buyer’s idea of $930 per tonne FOB.
Sunflower oil trade in six European ports was heard at $957.50 per tonne FOB for July/August/September loading.
Sunflower oil in the Black Sea region continued to slide under the pressure of low demand and the willingness of sellers to concede in price.
Offer levels were shown by Ukrainian sellers to be $860-865 per tonne CIF Mersin for April-May delivery, while the buyer’s idea was $850 per tonne CIF Mersin.
At the same time, a sunflower oil trade was heard at $854 per tonne CIF Mersin for delivery in April, which is $6 per tonne lower than at the beginning of the week.
Prices for sunflower crushers in the southern regions for sunflower with an oil content of 50% increased by at least hryvnia 300-500 per tonne per week to hryvnia 15,800-16,200 ($399-409) per tonne CPT plant, including VAT.
In other news, Egypt’s state buyer GASC bought 17,250 tonnes of overseas sunoil at an international tender and paid $930 per tonne CFR Egypt, payment at 180 days, for delivery May 1-30 and 18,000 tonnes of soybean oil at $1,050 per tonne CFR Egypt for delivery May 16-30.