Posted on January, 22, 2025 at 07:25 pm
World oilseeds prices eased in late 2024 and early 2025 as a bullish market ran into the prospect of a record Brazilian soybean crop.
In its Grain Market Report of Jan. 16, the International Grains Council (IGC) said that for soybeans, “average global export prices, as tracked by the IGC GOI sub-Index, were modestly weaker (down 2%), over the period since Nov. 20, as a heavy, seasonally inspired fall in Brazilian fob quotations outweighed gains in the United States and Argentina.”
“US nearby futures advanced solidly over the period, chiefly on supportive fundamentals, as generally decent export interest and tightening old crop availabilities buoyed market sentiment,” the London, England-based IGC said. “While gains in the value of the US dollar were a bearish influence, an upswing in crude oil prices added to the positive tone at times.”
With a modest easing of basis levels, Gulf export quotations increased by 3%, to $416 fob, it reported.
“In contrast, offers in Brazil (Paranagua) plunged fob values down by 11%, to $378 fob, owing to a steep fall in export premiums,” the IGC said.
Despite minor worries about crops in southern areas, the market was weighed by expectations for a record Brazilian soybean harvest, with Conab projecting a 19-million-tonne increase in production year on year, the Council noted.
In Argentina, where there are concerns about suboptimal weather, export prices were 1% higher, at $424 fob Up River, the IGC said.
Regarding the rapeseed market, the IGC said that in Canada “ICE canola futures increased by a net 2% since the November Grain Market Report largely on supportive fundamentals, more than offsetting pressure from future export demand worries.”
“Fob quotations (Vancouver) also advanced, but Australian fob offers (Kwinana) fell by $20 to $542,” it added.
The United Nations Food and Agriculture Organization said in its FAO Food Price Index, published on Jan. 3, that world vegetable oil prices had fallen 0.5% in December compared to November, but were still 33.5% higher than in December 2023.
“The marginal decrease of the index mainly reflected lower soy, rapeseed and sunflower oil prices, more than offsetting slightly higher palm oil prices,” the Rome, Italy-based organization said. “In December, international palm oil quotations on average increased by 2% from the previous month, largely driven by protracted tight supplies in leading producing countries in Southeast Asia.
“By contrast, world soy oil prices fell moderately, underpinned by prospects of ample global supplies and somewhat weaker demand in the US. Meanwhile, world rapeseed and sunflower oil prices also declined due to contraction in demand.”
Vegetable oil prices for 2024 were up 9.4% compared to 2023, the FAO said.
The US Department of Agriculture’s Economic Research Service (ERS) highlighted an increased crush forecast in its January Oil Crops Outlook. The forecast for world oilseed crushing in 2024-25 has risen by 2.1 million tonnes to 560.3 million, “on higher soybean, cottonseed, and sunflowerseed crush, which are partially offset by lower rapeseed crush,” it said.
Global soybean crushing is expected to reach a record high, the ERS said, due mostly to a 1-million-tonne increase in Brazil’s forecast 2024-25 crush, “on the higher soybean meal exports in the first quarter of the marketing year.”
“Furthermore, USDA’s Foreign Agricultural Service added Iraq’s soybeans and soybean oil data to the Production, Supply and Distribution database,” the ERS said.
Iraq, having relied for decades on imported soy meal, “started importing soybeans in 2022-23 after building a soybean crushing facility at the southern Umm Qasr Port with a capacity of approximately 3,000 tonnes per day, the FAS explained, putting Iraq’s 2024-25 soybean crush at 750,000 tonnes.
Source: World Grain