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Rapeseed Oil now Euro/MT140 below Soy Oil and Sunflower Oil

Although Palm is not considered a soft oil, it is also now priced euro/mt 100 above Rapeseed oil which is the first time in 25 years that this has occured. In soft oils we note that both soy oil and sunflower oil are now trading at parity while Rapeseed oil is trading 140Euro/MT below both of the oils. On the Biodiesel front, we note that these relationships are still not fully reflected with RME still trading at a premium to Fame 0. This despite a dismal demand picture in Europe, mostly led by strikes in the second largest economy of Europe. We are also still seeing strong backwardation to Q1 in Biodiesel with $181/mt for F0, +$44/mt for RME, and +$99/mt for UCOME. This is perhaps related to remaining backwardation in Soyoil to Dec23 which still stands at $53/mt while in Gasoil it is $39/mt for the same period. BOGO shows only +$15/mt backwardation for that same period. Lots of confusion but frankly 1. we are hardly running out of vegetable oil and 2. crack margins for diesel still are phenomenal at $44/brl, surely such will guarantee a steady supply of diesel and 3. Demand side of the picture is being affected by $ liquidity all over the world - even Switzerland! So is the backwardation there only just in case demand explodes or is it a structural issue? Hard to justify it.

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