Week 20: overview of the veg-oil market

Palm oil

  • In April, Indonesian crude palm oil production continued to recover from last year (+27% compared to April 2016) and reached 2.9 million tons even if it fell by 5% from the month before. Moreover, domestic consumption rose to 867 KT in April from 849 KT the month before.
  • Thus, domestic stockpiles decreased to 1.31 million tonnes from 2.3 million in March which contributed to the recovery of CPO prices.
  • Exports of crude palm oil from Malaysia increased by almost 9% during the first half of the month in comparison to the same period last year. A rising demand for physical product from the neighbouring countries due to the Ramadan festivities sustains the CPO prices.
  • From the beginning of May, Crude Palm Oil prices increased by around 5.5% and are now traded at $708 per MT on average in Rotterdam, back to their March level.


  • In the US, soybean crushing decreased sharply in April to 3.8 million tons while soybean oil exports remained steady. This led to a reduction of soybean oil stocks to 782 000 tons against 880 000 tons in April 2017.
  • Soybean crushing should increase over next months as an answer to the soybean oil demand from the US biofuel industry and ease the pressure on the American market.
  • The Brazilian National Agency CONAB estimates the soybean harvest up by 18.4% from last year to 113 million tons thanks to higher yields and acreage. This will boost Brazilian soybean export to around 63 million tons, a 10-million-tons increase from last year. Brazil will remain the second biggest producer of soybean worldwide.


  • Rapeseed oil prices firmed over the months of April and May, in Rotterdam prices increased by around 3.2% to $847 per Mt on average.
  • Nevertheless, the recovery of rapeseed oil prices remains limited due to the good production forecasts of palm oil in Malaysia and Indonesia and a weaker demand from biodiesel producers.
  • Rapeseed oil prices increased by around 3% on Euronext from the beginning of April until the 10th of May to around 372 euros per MT.  This week they fell back sharply to the level of 359 euros per MT dragged by soybean prices.
  • Indeed, soybean prices tumbled more than 3% in the aftermath of the Brazilian Real devaluation (-7%) after the President Telmer was accused of corruption.