Vegetable oil prices under pressure due to coronavirus, rapeseed oil drops more than 18%

In Germany, UFOP reports that the spread of the coronavirus sent global prices of crude oil and vegetable oil on a downward spiral. Rapeseed oil most recently cost EUR 690 per tonne. This translates to a more than 18 per cent decline within one month.

Soybean oil stood at EUR 605 per tonne, down just about 15 per cent, not least because soybean and rapeseed prices in Chicago and Paris dwindled considerably. Sunflower oil and palm oil recorded a decline of 11.5 and 16 per cent respectively compared to the previous month. The main stimulus for palm oil comes from the international futures market, which is impacted negatively by the estimated 20 per cent slump in Malaysian palm oil exports in March 2020.

The corona pandemic is creating pressure in the financial and commodities markets and also pulling down spot prices for oilseeds and by-products. Above all, crude oil has lost substantial ground in the wake of the oil output dispute between OPEC and Russia. The restrictions to curb public life, imposed as a consequence of the corona crisis, are reflected in the demand for transport fuels. Municipalities are ramping down local public transport. Road-based goods traffic, construction activities and the number of commuters all have dropped sharply. Diesel sales are in steep decline internationally. Demand for, or use of, biodiesel as a blending component and, finally, biodiesel producers’ demand for vegetable oil is decreasing to the same extent.