Mid December

Hello everyone,

Please enjoy a fresh overview of the food oil market.

🌻 Sunflower Complex (Black Sea, EU, Argentina)

Ukraine’s sunflower harvest is 93% complete, with total production stabilising at around 9.06 M tonnes and average yields holding steady at 1.88 t/ha, signaling no material increase in supply. SFS prices have crossed UAH 30,000/MT (~$790), VAT included.

In Russia, harvest is 89% complete. Despite a slight improvement in yields to 1.56 t/ha, total output is down by 4.5% YoY — at 16.92 M tonnes. Overall, SFS availability across the Black Sea region is largely fixed, with lower Russian production partly offset by stable Ukrainian volumes. This continues to provide fundamental support to SFO prices amid steady export demand.

Looking ahead to Argentina’s 2025/26 sunflower crop (early 2026 harvest), production is expected at around 5.4 M tonnes, sharply higher than last season’s 4.7 M tonnes.

SFO prices are currently in a consolidation phase:

– Black Sea FOB values have corrected to around $1,230–1,250/MT, reflecting a technical pullback rather than a shift in fundamentals.

– Mersin is trading around $1,315/MT versus $1,300 previously.

– European prices remain firm at a premium near $1,360/MT, supported by steady demand.

– Argentine forward prices at $1,210–1,250/MT remain volatile, with higher crop expectations already partly priced in.

Notably, more Argentine SFO offers are entering Middle Eastern markets, including KSA, UAE, and Iraq.

⚓️ Black Sea Logistics & Trade Flows

At this stage, there is no official confirmation regarding reports of a Turkish vessel carrying SFO being hit while sailing from a Ukrainian port toward Egypt. However, ongoing attacks on port infrastructure in Odesa and Chornomorsk are clearly disrupting export operations, largely increasing logistical and insurance risks.

This supports higher prices, particularly for refined SFO in containers. The rising war-risk insurance premiums and steady power supply issues at processing plants are key drivers.

RBDW SFO offers are indicated at $1,320–1,400 FCA, while Russian January offers to the Middle East are quoted around $1,420–1,450 CIF.

Meanwhile, India continues to show strong SFO demand, increasing December imports. In the EU, SFO supply is stable but not expanding; slightly lower crush volumes keep the market balanced and support prices.

🌱 Soy Oil (Argentina, Brazil, India, China)

Soy oil market remains in a clear downward trend, with Argentine January FOB dropping from $1,132 to $1,098/MT within a week. While the basis has strengthened slightly, FOB values continue to decline under pressure from expectations of a large South American crop and broad weakness across the soy complex.

Brazil is moving in the same direction, with January FOB around $1,100/MT and February–March trading lower.

In India, high port stocks and ample global supply are weighing on prices. China’s soy oil stocks are slightly lower, but overall inventories remain elevated. Soybean stocks are high and rising, keeping the market well supplied and price-negative in the near term.

🌴 Palm Oil & Rapeseed / Canola

Palm oil prices remain under pressure. BMD futures trend lower, and FOB values for Malaysian and Indonesian palm oil have softened, tracking weakness in the soy complex and ample near-term supply.

Canada’s 2025/26 canola crop is projected at a near record ~21.8 Mt on strong Prairie yields. This supports higher exports and expanding domestic crush, driven by renewable diesel demand. Same time, oil prices in China are under pressure due to record global canola and rapeseed output from Canada and Australia, rising supply, and expectations of inventory rebuilding.

📊 Timing, Outlook & Macro

Near term (December–January), the market is expected to stay soft to sideways, with limited upside. Some stabilization is possible in February–March, but there is still no strong bullish signal unless demand improves or stocks tighten.

Palm oil remains a drag on the broader veg oil complex and is likely to cap any sharp upside in other oils in the short term. Macro signals are also unsupportive: currency moves offer only limited relief, while weak crude oil prices and cautious risk sentiment pressure the market.

That’s all the news for now. Thank you for your attention, and stay tuned for the next update!