Oilseed Markets See Price Decline Amid Global Pressures
Oilseed Markets See Price Decline Amid Global Pressures
Rapeseed futures on Euronext fell for the second consecutive day on Wednesday, with the front-month February contract dropping by €0.50 to €535 per ton. Soybean futures at the Chicago Board of Trade (CBOT) also declined, with the January contract down 2.75 cents to 1,007.75 cents per bushel (€351 per ton).
The oilseed markets faced multiple pressures on Wednesday. Declining palm oil and crude oil prices pulled down soybean oil prices in Chicago, while concerns about China’s economic outlook have sparked fears of reduced demand. In China, soy oil prices plummeted by over 5% on the Dalian exchange, with palm oil prices also seeing significant losses, dropping over 4%.
The uncertainty surrounding the Trump administration's biofuel policy and the potential trade war ramifications between the U.S. and China are further unsettling the markets. Following the substantial price increases over recent weeks, a correction in vegetable oil prices was anticipated. After an eight-week rally, rapeseed prices on Euronext may have peaked, presenting an attractive opportunity to market the remaining 2024 harvest stocks.
Additionally, Indonesia reaffirmed its plan to increase the mandatory biodiesel blend rate with palm-based fuel from 35% to 40% by January 2025. This move, part of the new president’s immediate action plan, is expected to boost palm oil demand by 3 million tons annually, equating to nearly 4% of global production.
Rapeseed futures on Euronext fell for the second consecutive day on Wednesday, with the front-month February contract dropping by €0.50 to €535 per ton. Soybean futures at the Chicago Board of Trade (CBOT) also declined, with the January contract down 2.75 cents to 1,007.75 cents per bushel (€351 per ton).
The oilseed markets faced multiple pressures on Wednesday. Declining palm oil and crude oil prices pulled down soybean oil prices in Chicago, while concerns about China’s economic outlook have sparked fears of reduced demand. In China, soy oil prices plummeted by over 5% on the Dalian exchange, with palm oil prices also seeing significant losses, dropping over 4%.
The uncertainty surrounding the Trump administration's biofuel policy and the potential trade war ramifications between the U.S. and China are further unsettling the markets. Following the substantial price increases over recent weeks, a correction in vegetable oil prices was anticipated. After an eight-week rally, rapeseed prices on Euronext may have peaked, presenting an attractive opportunity to market the remaining 2024 harvest stocks.
Additionally, Indonesia reaffirmed its plan to increase the mandatory biodiesel blend rate with palm-based fuel from 35% to 40% by January 2025. This move, part of the new president’s immediate action plan, is expected to boost palm oil demand by 3 million tons annually, equating to nearly 4% of global production.