Early July

Hello Everyone, 

Please enjoy a fresh overview of the veg oil market. 

🌻 Sunflower Oil

Global sunflower seed production is set to recover from 51.96 MMT in 2024/25 to around 56.11 MMT in 2025/26.

Ukraine’s forecast is revised to 13.29 MMT. Sowing is nearly complete (~99%), matching last year’s pace. However, dry soil raises concerns as the crop enters a critical growth stage.

Russia’s harvest is expected to reach a record 17.5+ MMT on higher yields, despite same acreage. Upcoming forecasts predict favorable rainfall across key regions, potentially supporting both yield and late sowing conditions. The country’s export duties are set to decrease from mid-July through September, likely supporting exports. However, the strong ruble continues to limit outbound flows.

Meanwhile, CIF container exports remain slow, with buyers waiting for tighter price spreads between old and new crops. SFO stocks are gradually increasing, helping stabilize the market.

SFO prices:

- CPT Ukraine ~$1,100 (limited offers)

- FCA Ukraine ~$1,080

- RBD SFO ~$1,210

- Russia FOB offer $1,110 (down $20), Bid $1,080

- China bid FOB Shanghai/Qingdao $1,180

- Black Sea to India Old crop – July $1,190, Aug $1,180, Sept $1,150

- EU Ports OND contracts ~$1,150

🌱 Soybean Complex

This past week was bullish for soy, despite limited physical activity. Still, pressure remains ahead of OND.

- U.S. planting is 96% complete (flat y/y)

- Argentina’s harvest is 98.3% complete (vs 99.6% last year)

Biodiesel mandates in the U.S. are rising sharply, pushing soybean oil demand higher. Even when biodiesel production is not profitable, tax credits and mandates keep volumes up.

The U.S. is reallocating soybean supply from exports to domestic crushing, aiming to meet growing biodiesel feedstock demand. This reduces U.S. soybean exports, but global supply remains balanced due to Brazil and Argentina.

While U.S. SBO exports focus mostly on neighboring markets, Argentina remains the top global exporter.

Ukraine’s SBO supplies for EU biodiesel remain strong, with FCA offers holding at $1,050–1,100.

Russia’s soy exports mainly go to North Africa (Algeria, Tunisia), Iran, China, and CIS, where demand for soy oil in feed and industry remains high.

Turkey keeps exporting CDSBO to GCC.

Egypt may boost soy oil exports due to the favorable soy-to-palm price spread.

Meal prices:

- Ukraine soy meal ~$280/ton

- Sunflower meal ~$210/ton FCA

Russia and Egypt have mostly domestic meal use, while Ukraine and Turkey are export-reliant.

🌿 Palm Oil

CPO prices bottomed in June at MYR 3,700, not during JAS ’25 as earlier projected (MYR 3,500–3,600).

Key price drivers:

- U.S. biodiesel mandates causing stronger feedstock pull

- Potential rise in export duties in Indonesia to fund B40 biofuel

- Solid demand from India and China

India is expected import 1.5–1.6 MMT in JAS ‘25, but port/pipeline stocks remain low (~2.0 MMT vs normal 2.3–2.5 MMT). 

China’s total veg oil port stocks (soy, palm, rapeseed) as of June 20 are at ~2.06 MMT.

🌐Trade & Outlook

July 9, 2025 is the deadline for U.S. trade deals under President Trump’s “reciprocal tariff” policy. If no deals are reached, new tariffs (up to 70%) may begin August 1.

Overall, the market remains volatile, but pricing stays firm.

As we approach OND, fundamentals lean bullish. Supply remains manageable, but the key question is will the demand keep up.

Thank you