Vegetable Oil Prices Continue Move Higher, but Reduction of Technical Pressure May Slow or Reverse Gains in Short Term

The continued recovery in crude oil futures helped lift world vegetable oil markets on Thursday, but the gains in soybean oil were much smaller than palm oil. West Texas Intermediate (WTI) futures rose about 16 percent at the end of the U.S. agricultural session but was down about $2 per gallon from the overnight highs. The rally from the low set on Tuesday has brought the WTI contract back in touch with the 5-day exponential moving average and back into the range defined by the Bollinger bands, which may slow the rally down on Friday.

Soybean oil futures gained less than 1/4 percent (July contract +5 basis points per pound) as the weakness in crude oil during U.S. trading hours contributed to steady selling for most of the session. The July contract…