Vegetable oil markets received a broad lift this week as Brent crude oil prices climbed on the back of renewed geopolitical risk. Concerns over a potential conflict between the US and Iran pushed Brent to $71.5/barrel, up from $68.65/barrel the previous week, providing a common thread of support across palm, soy, and rapeseed oil markets.

Palm oil: crude prices hold firm despite weak exports

BMD crude palm oil prices increased to $1,041/mt from $1,030/mt at the same time last week. The move was driven by the strength in Brent crude oil prices, which managed to outweigh the drag from weaker export data.

Malaysian palm oil shipments during February 1–20 stood at 863,358 mt, which is 9% below the same period in January. Indonesian exports also declined in the first half of February, falling 15.35% compared to the same period in January, according to one surveyor. Production data from SPPOMA for the same period showed output down 22.24% compared to the equivalent period in January — a decline that is broadly in line with the seasonal February trend.

Soy oil: biodiesel policy in focus

CBOT crude soy oil continued to increase, reaching 59.39 US cents/lb, up from 57.29 US cents/lb the previous week. Brent crude strength and expectations surrounding US biodiesel policy news were cited as price drivers.

The market is closely watching the expected March finalization of US biodiesel policy details, which is widely seen as supportive for soy oil demand and prices this year. However, stocks remain elevated: soy oil inventories reported by NOPA stood at 1.9 billion lb, which is 50% above the same period last year. The market is waiting for firm policy news before making directional moves.

Meanwhile, NOPA reported a record soybean crush in January at 221.564 million bushels, 10.6% above the prior year’s level.

On the trade side, the US Supreme Court struck down Trump’s global tariffs, raising concerns about Chinese purchases of US soybeans. Trump subsequently announced a 10% flat tariff on all trading partners under a separate trade law.

Rapeseed oil: Brent-driven gains, comfortable canola stocks

MJJ crude rapeseed oil (FOB Dutch Mill) increased to EUR 1,072/mt from EUR 1,065/mt the previous week, with prices receiving support from the rise in Brent crude. MATIF rapeseed prices slid slightly by EUR 2/mt to EUR 490/mt, while ICE canola futures increased to CAD 677/mt from CAD 663/mt.

One trader noted that increased canola sales to China were seen as more likely following the US Supreme Court ruling, if China reduces its purchases of US soybeans. Canadian canola ending stocks are however expected to remain comfortable at the end of the marketing year.

Sunflower oil: Argentine arrivals weigh on prices

Crude sunflower oil (FOB 6 ports) declined to $1,430/mt from $1,453/mt the previous week. Reports of large arrivals of Argentine sunflower seeds into EU crushing hubs weighed on prices.

Sources indicate that around 400,000 mt may arrive in Bulgaria and 100,000 mt in Romania in the coming months, with 40,000 mt expected in Bulgaria in the near term. Argentine prices are reportedly around EUR 20/mt cheaper than Black Sea prices. Vesper’s partner vessel line-up data shows 300,000 mt of sunflower seed scheduled for loading or sailing from Argentina in February, partially confirming these reports.

Sunflower oil exports in February, mainly to India, reached 90,000 mt, compared with 70,000 mt in the same period last year.

Separately, storms in the Black Sea and ice in the Sea of Azov disrupted Black Sea sunflower oil exports in February.

This article is part of a more comprehensive vegetable oil market analysis. For the full analysis, visit: https://app.vespertool.com/market-analysis/2748