Vegetable Oil Market Update - Nov 05, 2011

Soybean

Reports in September of suggested good new crops and yield helped reduce prices by US$200 PMT along with concerns that demand would fall due to general economic conditions. Once this was substantiated and the crop correctly assessed prices began to increase again as early market reports on the total yield were misleading. Today prices are still considered to be a little on the high side but aren't expected to fall in the coming months.

Did you know....

That many vegetable oil prices are affected by the price of crude oil? When crude oil prices are high Soybean for example, is used as a biofuel. This significantly increases the demand on Soybean and therefore prices increase. Once the price is too high or crude oil prices reduce then businesses switch back to using crude oil and Soybean prices reduce. This is why the Soybean prices are set globally on the basis of crude oil prices.

Sunflower

Prices have again started to fall amidst speculation that the harvests in Russia and Ukraine will yield some good results.

In addition Argentina will see an improved yield this year on the back of the new plantings undertaken in the past two years. Argentina is expected to produce 3MnT in the next 12 months compared with this year's 2.3MnT.

Canola

Prices of Canola have started to fall and may continue to do so over the coming months. The Canadian harvest is currently underway and reports suggest production is likely to be as much as 13.5MnT, which will be one of the largest they've had to date.

In addition the Australian crop is predicted to be around 2.54MnT, which is an increase on normal months due to the unseasonal, yet beneficial rains.

Jojoba

Supply into 2012 will continue to cause buyers problems. Despite an increase in output from most corners of the World, demand is at an all-time high and pressure will continue to be on supply. Forecasts today suggest average prices will be more than double in 2012 compared to those already higher averages seen in 2011.

abp have secured stocks to increase our position in Jojoba in 2012 but it is highly recommended that you contact us in the coming few weeks to discuss your requirements.

News tags : Market Update

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