The soybean–palm spread continues to remain inverted, suppressing and dampening palm oil consumption demand, while terminal procurement intentions stay lackluster.

Yesterday, CBOT soybean oil futures rose, mainly supported by concerns about an escalation of the Iran conflict and strength in crude oil prices. Yesterday, Malaysian crude palm oil futures continued to rise for the third straight day, hitting a 15-month high, mainly because international oil prices rose and Indonesia plans to roll out a B50 biodiesel blending program this year. A weakening Malaysian ringgit exchange rate also provided additional support. In the domestic oilseeds and oils spot market, prices fluctuated and adjusted in line with the broader trend. Due to concentrated maintenance outages, oil mills reduced crushing volumes, tightening supply at the margin. This, together with pre-holiday replenishment demand, supported trade, with transactions mainly driven by just-needed procurement. However, end users remained more cautious about high prices; combined with expectations of a bumper soybean harvest in South America, the momentum for soybean oil to rise sharply was insufficient. In the short term, it is expected to maintain a range-bound, consolidating trend at elevated levels. The ongoing inversion in the palm-to-soybean spread continues to suppress palm oil consumption demand, keeping end-user procurement appetite subdued. Spot market trading has remained lackluster, and inventories are still at high levels, leaving limited upside room for palm oil spot prices. (China Feed Industry Information Network)