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CPO was supported by robust gains in soyoil futures on the CME, with additional support from increases in soybean oil and palm olein prices on the Dalian Commodity Exchange.
The most active September CPO futures contract on the Bursa Malaysia Derivatives Exchange surged by 2.39% to close at 4,063 ringgit ($962) per tonne, extending gains from the morning session when it closed 66 ringgit per tonne higher at 4,034 ringgit per tonne.
The contract was tracking overnight gains in CME soyoil futures following bullish news over US biofuel policies with the upward momentum continuing through Asia hours.
With the supply outlook for June expected to be tighter, with market sources largely in agreement that Malaysian June production is expected to be lower than May levels, this has also lent support to buying sentiment.
Meanwhile, the ringgit weakened by 0.71% against the US dollar after strengthening to a nine-month high the previous day, which made the ringgit-linked CPO futures more affordable for international buyers.
Palm olein futures on the Dalian Commodity Exchange ended the day higher, with the most active September futures contract up by 1.52% to 8,440 yuan ($1,178) per tonne, while the equivalent soybean oil futures contract was up by 50 yuan per tonne to close at 8,018 yuan per tonne.
The September rapeseed oil futures contract on the Zhengzhou Commodity Exchange was also up by 158 yuan per tonne, or 1.67%, to close at 9,619 yuan per tonne.
In the cash market, discussions for CPO for July shipment toward the end of the day were around $1,055-1,060 CFR West Coast India (WCI) while the last offers for August-September cargoes around $1,065-1,070 per tonne CFR WCI. Buying interest was largely muted, with offers much higher than import parity levels.
Meanwhile discussions for Indonesian CPO were heard at $1,015-1,025 per tonne FOB Indonesia for July, while olein offers were heard around $990-995 per tonne FOB for July shipments.
In the Americas, soyoil futures extended gains on the CME amid falling stocks and continued focus on bullish US biofuels policy developments. Strength in the soybean complex and higher crude oil prices also lent support.
The front-month August CME soyoil contract went up by 2.42% on the day to 54.96 cents per lb at 1pm US Eastern time.
The USDA NASS report released on Tuesday July 1 showed 6.11 million tonnes of US soybeans crushed in May, compared with 6.07 million tonnes in April and above the 5.75 million tonnes crushed a year earlier.
The data showed US soyoil stocks came in at 1.88 billion lbs by the end of May, down by 5% from a month earlier, and down from 2.08 billion lbs in March.
A tax bill approved by the US Senate on Tuesday, which included changes to the 45Z Clean Fuels Production Tax Credit, was viewed as bullish by market participants. The final version shortens the incentive’s extension to 2029 from 2031 and reinstates a previously expired tax credit for small biodiesel producers.
The proposal excludes from the 45Z all foreign-sourced feedstocks such as tallow and used cooking oil (UCO), effective 2026, except for those produced in North America (Mexico and Canada). The text is more aligned with the previous version approved by the House of Representatives.
The exclusion of foreign-feedstocks from the 45Z is bullish for products like US soyoil, as it tends to boost the demand from biofuels production.
The bill is set to return to the US House of Representatives before being sent to US President Donald Trump to be signed into law.
Crude oil rose for a second session after Iran enacted a law suspending cooperation with the IAEA, the UN nuclear watchdog, accusing the agency of providing justification for recent Israeli attacks.
Meanwhile, soymeal futures went up on the CME, mainly supported by higher soybean, corn and wheat prices, while product spreading with soyoil and good crush rates in Argentina’s offset part of the gains.
Soybean prices rallied in the session following prospects that China and the US could make progress in trade agreements involving agricultural products, according to news outlets.
The August CME soymeal contract went up by 0.51% on the day to $275.10 per short ton at 1pm US Eastern time.
In the South American physical market, Fastmarkets heard after its Wednesday assessment that Argentine soyoil for loading in October, November and December changed hands at an outright price equivalent to a discount of 7.90 cents per lb to October and December futures.
The August basis in Argentina was assessed at a discount of 6.40 cents per lb to August futures. In Brazil, the corresponding basis was assessed at a discount of 4.60 cents per lb to the same futures contract.
In the soymeal front, on Tuesday, after its assessment time, Fastmarkets heard a rumor that Argentine soymeal traded at a discount of $13 per short ton to August futures.
On Wednesday, the August basis in Brazil was assessed at a discount of $8.50 per short ton to August futures, while in Argentina the corresponding basis was assessed at a discount of $13 per ton to the same futures contract.
FOB Rotterdam rapeseed oil prices rose on Wednesday.
In the August period, offers were indicated at €1,018-1,025 per tonne, with bids made in a range of €995-1,003 ($1,174-1,184) per tonne.
For September and October, offers were made at €1,013 per tonne and bids were made at €1,005 per tonne.
For the November–December–January (NDJ) period, offers were made at €1,020-1,040 per tonne. Bids were heard at €995-1,000 per tonne.
No rapeseed oil trades were heard on Wednesday.
FOB sunflower oil prices across six EU ports also rose on Wednesday.
For the July–September (JAS) period, offers were made at $1,210 per tonne FOB compared with $1,200 per tonne on Tuesday. Bids were absent from the market.The October–December (OND) period offers were made at $1,185 per tonne, while bids were made at $1,155 per tonne.
Sunflower oil was reported to have traded at $1,205 per tonne for the July-September period and at $1,175 per tonne for the October–December (OND) period.
Sunflower oil prices in the Black Sea region were under pressure on Wednesday, driven by aggressive Russian offers, as the market experienced a further drop of $5 per tonne to $1,165 per tonne for August loading, while July offers held at $1,170 per tonne.
Still, buyers maintained bids at $1,155–1,160 per tonne CIF Mersin.
A trade was reported at $1,165 for Ukraine-origin sunflower oil with July shipment, confirming earlier market talk and indicating limited seller resistance at current levels.
Ukraine-origin was otherwise offered at $1,175 per tonne for July delivery, while new crop positions were quoted at $1,190–1,195 per tonne, but such levels were considered unworkable in the current pricing environment.
In the domestic Ukrainian market, spot sunflower oil on a CPT Pivdennyi-Odesa-Chornomorsk (POC) basis was indicated at $1,085–1,090 per tonne on the bid side, with buyers reportedly willing to pay up to $1,095 per tonne. Even so, market liquidity remained low, with few offers reported.
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