Oilseeds. World Markets and Trade. Dec 2013 Dec. 11, 2013
U.S. Soybean Oil Price Plummets in 2013
Falling crude soybean oil prices, down 20 percent since May, have now reached a level last seen in mid-2010. Much of the decline is associated with the overall fall in soybean prices, which have tumbled as production in South America and the United States improved. Also contributing to the fall in soybean oil prices is the general downward trend in vegetable oil prices, a response to larger rapeseed and sunflowerseed harvests.
Oil prices are expected to stabilize at current levels, but remain dependent on price movements in the underlying oilseeds. However, stronger demand at current lower prices should provide some support. In addition, slowing palm oil production coupled with declining stocks has strengthened prices and cut into discounts with respect to other oils. This will likely strengthen demand for soybean and other oils.
Global soybean production is higher with larger crops in Argentina and Canada. World trade is up driven by strong foreign demand for U.S. soybeans. U.S. soybean exports are raised. The season average U.S. farm price is raised supported by prevailing cash bids.
U.S. export bids, FOB Gulf, in November averaged $526 per ton, slightly higher than the previous month, supported by strong foreign demand.
As of the week ending November 28, U.S. soybean commitments (outstanding sales plus accumulated exports) to China totaled 24.0 million tons compared to 17.5 million a year ago. Total commitments to the world are 37.6 million tons, compared to 28.4 million for the same period last year.
2013/14 TRADE OUTLOOK
• United States
o Soybean exports are up 680,000 tons to 40.1 million on exceptionally large sales to-date, mainly to China, Russia, and Indonesia.
o Soybean imports are up 272,000 tons to 680,000 based on purchases during September and October.
o Soybean meal exports are up 226,000 tons to 9.5 million reflecting strong sales to-date, especially to the EU and Southeast Asia.
o Rapeseed imports are boosted 550,000 tons to 1.6 million based on large purchases to date.
o Palm oil imports are up 114,000 tons to 1.2 million reflecting continued strong demand.
o Soybean meal exports are up 400,000 tons to 29.4 million on larger supplies and expectations of price competitiveness.
o Soybean oil exports are down 95,000 tons to 4.6 million to reflect greater domestic use.
o Sunflowerseed meal exports are cut 100,000 tons to 470,000 on reduced crush.
• Canada’s soybean exports are up 250,000 tons to 3.5 million, and rapeseed up 300,000 tons to 8.3 million in response to larger crops and strong foreign demand.
• China’s rapeseed imports are up 500,000 tons to 3.3 million on anticipated stronger demand for crush.
• European Union
o Soybean imports are up 200,000 tons to 12.3 million to reflect large shipments from Canada to Germany and the Netherlands.
o Soybean meal imports are up 500,000 tons to 20.6 million on larger purchases from the United States.
• Malaysia’s palm oil exports are up 300,000 tons to 17.5 million on continued pace of shipments.
• Russia’s soybean imports are up 150,000 tons to 1.1 million to reflect U.S. shipments to-date