It is remarkable that we moved from +$30 backwardation in diesel a month ago to a -$4 contango yet the backwardation for gasoil of Jan23 to April is still +$40/Metric Ton. FAME premiums through April23 are showing an -$80/mt contango although UCOME premiums are at -$60/mt while seasonal favourites like RME are at -$25/mt. This reflects poor spot demand but more importantly FAME is trading at significant discount to BOGO even at current Bean oil levels. This begs the question is why is Soybean oil which is not subject to sanctions or for that matter to supply issues still backwarded? Think important to note that this phenomenon of soy oil backwardation mimicking diesel has been exceptional and pervasive this year. Disappointing RVOs has certainly collapsed the spot soy oil values by almost $200/mt and we are seeing z/k soy oil still at +3.78 ($83/metric Ton). No way to justify this when similar spread on gasoil is +40/mt. There is further downside here...
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