SBO futures up on railroad stoppage, crush figures

US soybean oil (SBO) futures rose by 2.5pc during the past week, amid a rail strike in Canada and a new crush report showing higher US soybean crush for July but lower soybean oil stocks.

The September CBOT soybean oil contract closed at 41¢/lb on 21 August, up from 40.01¢/lb a week earlier.

The National Oilseed Processors Association (NOPA's) July crush report on 15 August showed US soybean crush at 182.9mn bushels, 5.5pc higher from last year and up by 4.2pc from the prior month. But July soybean oil stocks were reported at 1.5bn lbs, down by 7.6pc from the prior year and 1.8pc lower from the prior month, indicating more consumption.

Market talk also revolved around a strike involving Canada's two largest railroads Canadian Pacific Kansas City and Canadian National.

US biofuel producers and the US food industry import soybean oil and canola oil from Canada, mostly the latter since Canada is the largest canola producer in the world. Market participants mentioned some veg oil sellers are suggesting canola oil food customers switch to soybean oil for the short term, even though it could be too early to gauge potential consequences from the strike.

By Jamuna Gautam