Periodic Updates on the Futures Markets

January canola is down $1.40 per metric ton (mt), March soybean oil is down .08 cents per pound, European February rapeseed is down 1.25 euros per mt and January Malaysian palm oil is unchanged. March oats are down 4 cents per bushel. January crude oil is down $.31 per barrel and the December Canadian dollar is down .0003 at .71075. The U.S. Dollar Index is down .110 at 106.230.

From the “It won’t matter until it matters” file — USDA reported another soybean oil flash export sale Wednesday morning of 30,000 mt or 66 million pounds to South Korea. That takes total commitments to 939 million pounds compared to the current USDA annual projection of 600 million, just nine weeks into the marketing year. More of the same can be expected as long as soybean oil is at a discount to palm oil instead of the normal premium. With the latter at contract highs and the recent selloff in Chicago, soybean oil stands at a $200 USD per mt discount to palm oil for the first time in history. It normally spends time between $50 and $150 mt premium to palm oil. During times of concern, it has traded at $600 mt over palm oil.

The reality may be setting in as early weakness is starting to be shaken off with vegetable oil markets trading near morning highs. Slight weakness in energy markets are offsetting the benefits of a weaker U.S. dollar.