Arabfields, Sophia Daly, Financial Analyst specialized in Agriculture and Futures Markets — Indonesia’s ambitious plan to implement a B50 biodiesel mandate in 2026 is likely to be postponed to 2027, according to a note from Citi analyst Gan Huan Wen. This delay, attributed to budgetary constraints and an unfavorable spread between palm oil and gas oil prices, could influence crude palm oil (CPO) prices, which have been supported by speculation around this measure in recent months. Gan forecasts that CPO prices will hover between 4,300 and 4,500 MYR/tonne by year-end, while maintaining a bearish view on the sector and advising investors to take profits on SD Guthrie at current share price levels. Citi has raised its CPO price assumptions to 4,300 MYR/tonne for 2025 (from 4,200 previously) and 4,200 MYR/tonne for 2026-2027 (from 4,000).
This development comes amid fluctuations in agricultural commodity markets, where futures prices show a moderately upward trend for several key crops.
Futures prices recorded modest overnight gains: SRW wheat up 1/2 cent, HRW up 1 3/4, and HRS up 1 1/4. Corn advanced 1 1/4 cent, soybeans 5 1/4, while soymeal fell $0.90 and soyoil gained 0.60 cent.
For the current week, trends are mixed: SRW wheat up 1 cent, HRW down 1 1/4, and HRS up 3 1/2. Corn gains 2 1/2 cents, soybeans 17 3/4, soymeal $9, but soyoil recedes 0.55 cent.
Month-to-date, declines dominate for wheat (SRW -3 3/4, HRW -7 1/2, HRS -13 3/4), while corn rises 8 3/4 cents, soybeans 35, soymeal $15.80, and soyoil 1.18 cent.
Year-to-date, nearby futures show losses for most: SRW wheat -8.5%, HRW -12.3%, HRS -7.3%; corn -7.3%; soymeal -5.7%. In contrast, soybeans gain 4.0% and soyoil surges 27.1%.
In Asia, Chinese agricultural futures (JAN 26) show soybeans up 31 yuan, soymeal up 44, soyoil down 40, palm oil down 110, and corn unchanged, Malaysian Palm is up 18.
Malaysian palm oil closed up 18 ringgit (+0.40%) at 4,474.
No changes were recorded in registrations, with totals of 34 contracts for SRW wheat, 124 for oats, 80 for corn, 153 for soybeans, 765 for soyoil, 364 for soymeal, and 619 for HRW wheat.
Preliminary changes in open interest as of October 22 indicate an increase of 105 contracts for SRW wheat, a decrease of 965 for HRW, an increase of 7,116 for corn, a decrease of 5,998 for soybeans, 7,382 for soymeal, and an increase of 8,468 for soyoil.
The funds’ balance as of October 22 reveals net buys of 2,000 SRW wheat contracts, 3,500 corn, 1,500 soybeans, 4,500 soymeal, but sales of 5,500 soyoil.
The weather forecasts for October 23 highlight varied risks for agricultural crops worldwide.
In North America, persistent cold affects the eastern United States in late October, but key spring crop regions in the Midwest remain relatively mild. In the Northern Plains, after recent rains, a few calm days are expected, followed by possible showers Sunday or Monday. The Central and Southern Plains, dry recently, will see scattered showers from Thursday through the weekend, beneficial for winter wheat establishment. The Midwest faces isolated showers through Thursday, with possible frosts, and a stronger system could bring rain and strong winds early next week, helping combat drought but delaying harvests. In the Delta, recent rains have helped against drought but little for Mississippi levels; more showers are forecast this weekend.
In South America, a strong cold front will cross the Pampas, risking damage to wheat crops with heavy rains and winds. In Brazil, a front has cleared the country, leaving cool and dry weather for the rest of the week, favorable for a rapid soybean planting pace, though the dry stretch is slightly concerning. A new front will arrive in the south this weekend and in the center mid-next week. In Argentina, showers are spreading for the rest of the week, favorable for corn planting and early growth; soybean planting will begin soon.
In Europe, active rains will affect most EU countries over the next 5 days, delaying planting and spring crop harvests. The Black Sea saw scattered showers this weekend, but drought persists, especially in southwestern Russia; limited rains this week, with a front on Friday potentially more beneficial.
In Australia, heat is expanding in Queensland, affecting soil moisture in sugarcane areas. In the tropics, Tropical Storm Melissa could intensify into a Category 3 hurricane, mainly impacting Jamaica and the Greater Antilles.
On the international trade front, Algeria’s state grains agency OAIC is believed to have purchased around 600,000 metric tons of milling wheat in an international tender that closed Wednesday. Jordan issued a tender for up to 120,000 tons of milling wheat from optional origins, but made no purchase in a tender for 120,000 tons of feed barley.
For rice, South Korea, through the Agro-Fisheries & Food Trade Corp, issued tenders for an estimated 78,744 tons of rice from China, Thailand, and optional origins. Bangladesh issued another tender for 50,000 tons of rice.
These movements underscore sustained demand for cereals, in a market influenced by climatic uncertainties and policy adjustments like Indonesia’s.
As agricultural markets navigate between speculation and weather realities, investors are closely monitoring these developments that could reshape global supply chains.
