The prices of the main vegetable oils have behaved unevenly over the last month, with increases in lauric, coconut and palm kernel oils, and falls in the rest of the main oils, with greater intensity in palm, which is currently trading at a significant discount with respect to the rest of the oils.
On the other hand, the recent news of the 120-day extension of the Black Sea grain corridor has put additional downward pressure on the markets. However, the extension period is shorter than rumours indicated.
The table below shows the evolution of some oils and other relevant factors in the last month:
And about the main oils, palm oil production in Indonesia is not growing at the rate expected a few months ago. Oil World has reduced the production estimate in Indonesia from 47.9 million tonnes to 46.5 MnT by 2023. Malaysia is not expected to have a good 2023 production level either.
Likewise, Oil World and Godrej Int. Ltd, believe it is unlikely that palm prices will fall in the coming months due to:
• Significant discount to soybean oil.
• High rate of exports (August/October has set a record in exports from Indonesia and Malaysia).
• Uncertainty related to the war in Ukraine.
• Rapid decline in palm stocks in Indonesia.
• Entry into the period of lower palm production (January-June).
As far as sunflower is concerned, 93% of the planted area has already been harvested and the volume reaches 9.5 MnT of seeds. A very good harvest is expected in Russia. Exports from Ukraine continue at a very good pace.
For soybeans, the great uncertainty comes from the harvest in South America, which is harvested between February and May. There is a strong drought in Argentina, and in parts of Brazil (especially in Rio Grande do Sul). In Argentina, the area planted with soybean and maize until 17 November is the lowest in 22 years.
In this changing and uncertain scenario, we invite you to download and continue reading LIPSA’s market report below, where you will be able to get first hand information on:
1. Vegetable oil prices
3. Palm oil
4. Lauric oils (coconut and palm kernel)
5. Soybean oil
6. Sunflower oil
7. Rapeseed oil