Palm Oil Advance Sweeps Soy Oil Futures Higher before Weekend

Global edible oil prices were sharply higher on Friday, with short-covering and fresh buying before the weekend driving gains. Tracking strength in the palm oil market, soybean oil futures in the U.S. climbed on bean oil/meal spreading. However, the advance was kept in check by somewhat less bullish weather forecasts for the Corn Belt that included cooler and wetter weather for the region through the first week of August.

Although the GFS 10-to-14-day weather model updated at noon still showed warmer and drier conditions for much of the Midwest, particularly western regions, overnight forecasts outlined more seasonable temperatures and increased chances of rainfall for the region through the same period. Still, the drought status in the Canadian Prairies and northern Plains will persist over the next two weeks, increasing crop-growing stress and limiting potential yield outcomes, particularly for canola.

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