Profit-Taking Drives Soybean Oil Prices Lower

Vegetable oil futures were mixed on Friday with palm oil prices supported by gains on Thursday in soybean oil, while fund spreading triggered profit-taking in the soybean oil market. Vegetable oil cash markets in China also followed Chicago futures higher, which led to a rally in futures prices on the Dalian exchange. The move, in soybean oil futures, on Thursday also drove cash rapeseed oil prices in China higher on Friday. Rapeseed oil cash prices have been the driving force behind much of the rally in world vegetable oil prices and will likely continue to support soybean oil and palm oil futures in the short term.

Soybean oil futures declined by about 3/4 percent (December contract -26 basis points per pound). However, the benchmark December contract was able to settle above the psychologically critical 33-cent level. It…