Rising Energy and Soybean Futures Push Soy Oil Prices Higher

Vegetable oil prices rallied on Wednesday as continued strength in the energy market and a sharp rally in soybean futures supported prices. Crude oil futures gained about four percent (December contract +$1.49 per barrel) following inventory data showing a decline in stocks and increasing momentum for a delay in output from the Organization of Petroleum Exporting Countries (OPEC+) and other affiliated countries. Selling at the 20-day moving average limited the gains. Still, the benchmark contract settled above the $39 per barrel level and narrowed the spread between soybean oil prices and heating oil prices, suggesting improving biodiesel producers’ profitability.

Soybean oil prices gained about two percent (December contract +61 basis points) despite light meal/oil spreading by funds. The rally left the…