Trading in the US cash market for vegetable oil remained dull in the week to Friday September 27. Activity has slowed to a crawl, several market trading sources told Fastmarkets.
Most end users, particularly those in the food sector, have covered their positions through the end of this year, according to the same market sources.
“Things remain under pressure. Food demand has backed off as a majority of the market feels well covered through the end of the calendar year,” one source said.
This lack of buying interest and demand is expected to continue to weigh on basis indications for soybean oil in the near term.
On Friday, Fastmarkets assessed soybean oil, basis, crude-degummed, US Gulf at a premium of 400-450 basis points per lb to the underlying soybean oil futures contract in Chicago. This was down from a premium of 450-500 basis points per lb at the start of the week.
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