Soybean Oil

Over its last 20 sessions SOYOIL has moved 1.13% on a typical day, making it one of the calmer of the commodities Kinzan tracks (their median is 1.88%).

At +0.1σ, the last 24 hours have been an entirely ordinary session for SOYOIL.

It sits in the lower half of its 24-hour range of 66.56–67.19, measured on hourly closes.

The London block (07:00–13:00 UTC) did most of the work — roughly 64% of the movement over the last 24 hours.

Over the last 60 sessions of daily returns, it has moved most closely with SOYBEAN (+0.55, a moderate relationship).

Its last close is at the 5th percentile of its own last 83 sessions, and its 20-day volatility at the 6th, near the bottom of its range for the period.

Market read: Soybean oil is trading flat, showing no clear direction as volume remains unremarkable.

What it is

Soybean oil is the liquid fraction extracted when soybeans are crushed, a little under a fifth of the bean by weight. It goes into cooking oil, margarine, dressings and processed foods and, increasingly, into biodiesel and renewable diesel. The Chicago Board of Trade contract is quoted in US cents per pound and covers 60,000 pounds. It belongs to a global vegetable-oil complex that also includes palm oil, produced mainly in Indonesia and Malaysia, along with rapeseed and sunflower oil, and large buyers switch between them on price.

What drives it

The defining change of the past two decades has been energy policy. In the United States the Environmental Protection Agency sets blending obligations under the Renewable Fuel Standard, and tax credits support biomass-based diesel; together they have made fuel producers a major buyer, so announcements on those volumes can move the price as much as any crop report. Biofuel mandates in Brazil, Indonesia and elsewhere have a similar effect on the wider vegetable-oil market. On the supply side, the soybean harvests of the United States, Brazil and Argentina matter, as does palm output in South-East Asia, which follows its own seasonal cycle and is sensitive to the dryness that El Niño years can bring. Export restrictions by Indonesia, the largest palm producer, have at times jolted the whole complex. Because biofuels compete with conventional diesel, energy prices feed directly into its value.

How it trades through the day

Soybean oil trades the CBOT grain hours. Its overnight session begins in the Asia block (22:00–07:00 UTC) and extends into the London block (07:00–13:00 UTC). Palm oil futures in Kuala Lumpur trade during Asian hours, so moves there often show up in overnight soybean oil. After a short break, the day session in the New York block (13:00–22:00 UTC) brings the bulk of volume before closing in the early Chicago afternoon.

What it tends to move with

Soybean oil tends to move with soybeans and, through biofuel demand, with heating oil — the US diesel benchmark — and more loosely with WTI crude and Brent crude. It often diverges from soybean meal, because strong oil demand encourages crushing and adds to meal supply. Malaysian palm oil and European rapeseed oil are its closest relatives abroad.