A sharp drop in oil prices and improving weather conditions in South America are adding downward pressure to vegetable oil prices, which have been falling for a week.

February Brent crude oil futures on London's ICE Futures Exchange fell 1% to their lowest level since July ($10,3/barrel, -77,2) on Dec. 5,5 amid slowing global demand % for the week, 9,6% for the month).

January futures for WTI crude oil in electronic trading on the NYMEX New York Stock Exchange fell 1% to $5,13/barrel since December 72,3 (-5,8% for the week, 11,3% for the month).

In the wake of oil prices and forecasts of lower demand from the Biodiesel industry, soybean oil futures on the Chicago Stock Exchange fell 1% to $4/ton in January from December 1.107 (-5,5% from the previous week, -0,5% from the previous month), losing speculative profits due to Fears about a possible reduction in Brazil's soybean harvest.

Pressured by lower oil and vegetable oil prices, Malaysian palm oil futures fell for the third straight day, despite exports rising 2-11% in November and inventories falling due to a surge in Indian shipments.

Palm oil futures for February on the Bursa exchange fell by 1% since December 3st to 3781 ringgit/ton or 810 USD/ton (-4,5% in fourteen days).

Malaysian palm oil stocks fell in November for the first time since April due to lower seasonal production, while oil exports continued to rise.

On the Dalian Stock Exchange, the most traded soybean oil contract fell 0,42 percent yesterday, while palm oil fell 1,36 percent.

Sunflower oil prices in Ukraine fell another 5% to $750-770/ton, with delivery to Black Sea or Danube ports under pressure from increased oil supplies on the Turkish market. Demand prices there reached $880-910/ton last week, but then fell sharply due to falling prices in India and China.

Source: Ukragroconsult (Ukraine)