Vegetable oils have been in an up trend for two years. About every six months, vegetable oil has a major price correction that lasts three to five weeks and then resumes the uptrend. Lower bean oil had dragged soybeans down this month. Meanwhile soybean basis at the Gulf and domestic crushers continued to firm, which we have mentioned several times a week for a more than a month.
After making a contract high on April 29th, palm oil and bean oil had a major correction. Palm oil bottomed on May 20th and resumed the uptrend, but bean oil was mostly sideways to a bit lower and made the correction low last evening.
Soybeans were firm over night on rising basis and rising palm oil and finally rising bean oil. Then crude oil went from $110.27 today to over $114.50. Higher crude means more biofuel demand which means more bean oil demand which means higher bean oil prices which means higher soybean prices if meal is steady. Some place around the $11.60 area on July crude today, it began a decided move higher.
About 50 minutes ago, it was reported by Reuters that a Russian operated crude oil tanker, the Pegas, loaded with Iranian crude was seized off the coast of Greece. The oil was being transferred to another tanker to be unloaded in the USA.