November 13

11/13 - El Niño’s effect on palm oil prices, and a big increase in soy-oil usage for renewable diesel, are both bullish for soy-oil prices. The USDA pegged soy-oil use for biofuel at 12.8B pounds or 47.4% of all 2023/24 U.S. soy-oil output. However, at Market Vision’s Orlando Conference, Brian Williams of Macquarie Bank said that a large volume of ancillary oils has been filling the gap on additional capacity due to their lower carbon intensity scores. The EIA reports that canola oil for biofuel use is up 111% YOY; animal fat up 120%; and used cooking oil up 58%. Meanwhile, soy-oil usage for biofuel is up 29% - significant but below expectations. The USDA lowered its 2023/24 soy-oil price forecast from $.63 to $.61/lb. Soy-oil futures, which hit $.72/lb. in late July, have declined to $.5120 (11/10). With futures contracts for 2024 averaging $.50/lb., this could present the contracting opportunity you’ve been waiting for.