In a new report, the USDA has increased its forecast for world production and stocks of vegetable oils

In the April balance, USDA experts sharply increased the forecast for world production of vegetable oils in 2021/22 MY, including palm, and the assessment of final stocks, given the reduction in exports and processing.

Analysts had expected another drop in the soybean oil production forecast due to reduced soybean yields in South America and a decline in sunflower oil production due to the war in Ukraine, but the increase in the palm oil production forecast surprised the market.

Compared to the March report, the new balance of vegetable oils for 2021/22 MY has undergone the following changes:

• The forecast of world production increased by 0.6 million tons to 212.04 million tons (206.51 million tons in 2020/21 MY), including palm – by 1.46 million tons to 77.05 (73.11) million tons. At the same time, the estimate of soybean oil production was reduced by 0.4 million tons to 58.97 (59.16) million tons, and sunflower oil – by 0.72 million tons to 20.39 (19.07) million tons.
• The forecast of world consumption was reduced by 0.16 million tons (after it was reduced by 0.47 million tons in October, in November – by 0.46 million tons, in December – by 0.64 million tons, in January – by 0, 48 million tons, in February – by 0.39 million tons, in March – by 1.2 million tons) to 208.92 (204.99) million tons.
• The estimate of world imports was reduced by 1.07 million tons to 81.88 (82.02) million tons. As a result of blocking supplies from Ukraine, imports of sunflower oil will decrease by 1.41 million tons, including India by 0.3 million tons, China – At the same time, imports of palm oil will increase by 0.3 million tons to 48.18 (47.46) million tons, in particular to China – by 0.4 million tons to 7.1 million tons.
• The forecast of the world’s final reserves increased by 1.9 million tons to 26.07 (26.67) million tons, including palm oil – by 1.03 million tons and sunflower – by 0.49 million tons.

According to the report, June futures for palm oil on the stock exchange in Malaysia rose 3% to 6005 ringgit / t or $ 1420 / t amid declining supplies of soybean and sunflower oil.

According to the MRO, palm oil stocks in Malaysia have been declining for 5 months in a row, falling by 3% to 1.47 million tonnes in March, while its production increased by 24% to 1.41 million tonnes and exports by 14.1 million tonnes. % to 1.27 million tons. High demand from importers due to reduced supply of Ukrainian and Russian sunflower oil.

May futures for soybean oil on the Chicago Board of Trade yesterday rose 1.4% to $ 1,663 / ton, adding 7.8% since early April.

In Ukraine, the prices of sunflower oil for DAP – western border remain at a low level of 1400-1500 $ / t, while the prices of demand for such oil in China and India reach 1700-2000 $ / t with delivery, as supply shortages remain.

GrainTrade 

Tags: rapeseed oil, Ukraine, China, sunflower oil, soybean oil, USDA Report, India, Malaysia, palm oil