COMMODITY OIL TRENDS

Farmer's Report

SOY, CANOLA & PALM OIL Trends - December 3, 2021

SOY OIL

Soybean oil futures closed sharply lower on Wednesday vs the prior week.

Reported market drivers:

  • The January soybean oil futures contract dropped nearly 12% from the high made on the day before Thanksgiving to this week’s low
  • South American soybean planting is reported to be mostly complete, and the early season weather has been nearly ideal. Some analysts are calling for a record Brazilian crop to be harvested in January/February, if weather continues to be favorable
  • Soybean oil basis levels remained mostly steady compared to last week
  • There is still no announcement from the EPA on biodiesel mandates for 2022

CANOLA

  • Canola oil basis offers remained firm this week for Q1 and Q2 of 2022, as historically elevated seed prices continue to affect forward-crushing margins
  • Canadian canola seed exports remain about a third of last years in a continued effort to ration tight supplies from this year’s poor Canadian crop. Crusher demand remains solid despite higher seed prices, as oil demand remains solid, according to analysts

PALM OIL

  • Palm oil futures prices pulled back a bit, but are still hovering near their all-time highs on solid demand and lower seasonal production in Malaysia and Indonesia, according to analysts
  • According to updated cargo surveyor reports, Malaysian palm oil exports are up 6 to 10% for the month of November vs. October
  • China buying remains solid as their need for vegetable oils has grown due to a lower internal soybean crush, according to analysts
  • Palm oil and soybean oil prices are now near parity

Mayo & Margarine

  • The soy and palm oil components of mayonnaise and margarine were both lower this week. Butter remained steady to firm

The data contained in the Farmer’s Report is provided for informational purposes only, is not tailored to your specific purchasing needs, and is not intended as a substitute for any other publicly-available market data or information. The Farmer’s Report is compiled from the last-received market data provided by the United States Department of Agriculture (USDA) and/or other market sources, and is subject to change without notice. Nothing herein is the opinion of US Foods®. US Foods neither assumes any legal liability nor makes any warranty or guaranty, either express or implied, regarding the completeness, accuracy or usefulness of this information.