Vegetable oil prices rose slightly after falling last week.
Vegetable oil markets are under pressure as fundamental demand weakens, though traders hope higher prices due to reduced sunflower oil supply. Palm oil rose on geopolitical tensions, supporting soybean and sunflower oils. EU imports are expected to fall 19% in 2025/26, while Indian buyers purchased 150,000 tonnes of discounted soybean oil.
Vegetable oil markets remain under pressure from uncertainty over future price trends, although fundamental factors point to a decline in demand, but traders are hoping for higher prices as a result of reduced sunflower oil supply.
Palm oil prices recovered last week and supported soybean and sunflower oil prices, although rapeseed oil prices remained under pressure from rising supply.
The main reason for the speculative rise in oil and vegetable oil prices was the drone attacks in the Black Sea on sanctioned tankers carrying Russian oil, as well as the attack on a Russian vessel carrying Russian sunflower oil.
According to the Turkish Ministry of Transport and Infrastructure, the tanker Midvolga 2, en route from Russia to Georgia with sunflower oil, was attacked 130 km off the Turkish coast. It did not request assistance and continued toward Sinop with its engines running. There was no threat to the lives or health of the 13 crew members.
December palm oil futures (FCPO1) on Bursa Malaysia rose 4.2% this week to 4,159 ringgit/tonne or $1,007/tonne, reversing the previous week’s 5.9% decline, despite a slowdown in November exports and an increase in production. Official data will be released on December 10, and the market expects further growth in Malaysian palm oil inventories. However, traders are hopeful that the situation will change in December due to a seasonal production cut, and Indonesia will increase the palm oil content standard in fuel from 40% to 50%, which will reduce exports.
February Brent crude futures traded at $62.5 per barrel (-3% for the month) during the week, anticipating progress in US-Russian negotiations to end the war.
Chicago December soybean oil futures rose 4% this week, reversing a 3.8% decline in the previous week, and are now trading at $1,160/t (+4.8% for the month).
The price of soybean oil in Brazil rose by $20/t in a week to $1130-1140/t FOB, but the price of soybean oil in China rose only $10/t to $1170-1175/t Daylian due to large supplies.
Prices for sunflower oil with delivery to India increased by $10-15/t over the week to $1315-1325/t CIF Mumbai, while prices for Russian sunflower oil (for delivery in December) increased by $5-10/t over the week to $1210-1215/t FOB.
Demand prices for sunflower oil in Ukraine (for delivery to ports in December) remained at $1,230/t for the week, and the number of offers from producers is growing.
EU rapeseed oil prices traded at $1,260-$1,265/t FOB Netherlands during the week, amid an increase in the rapeseed harvest forecast in Australia.
According to the European Commission’s forecasts, in 2025/26 MY, EU countries will reduce their imports of vegetable oils by 19% compared to the previous season to 5.6 million tons, including palm oil by 26% to 2.5 million tons, sunflower oil by 10% to 2.3 million tons, and soybean oil by 28% to 0.5 million tons, while rapeseed oil imports will remain at 0.3 million tons.
According to Patanjali Foods Ltd., one of India’s largest buyers of vegetable oils, local importers purchased over 150,000 tonnes of soybean oil from South America for delivery from April to June 2026. This was facilitated by a $20-30 per tonne discount on soybean oil compared to palm oil, although soybean oil typically costs $70-100 per tonne more than palm oil. This indicates sellers are willing to lower prices in anticipation of a large harvest in South America in the new season.
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Source : Ukr Agro Consult
