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US Biofuels Update: Soybean Oil Hits New Highs Amid Middle East Uncertainty

-- Biofuels feedstock futures closed higher on Tuesday, as soybean oil futures reached a new high amid uncertainty in the Middle East peace talks.

The Chicago Board of Trade May soybean futures contract closed 0.75% higher at $11.74 per bushel, and the CBOT May soybean oil futures contract settled 3.60% higher at 72.14 cents per pound.

On Monday, the May ethanol futures contract on the Nymex ended 0.26% higher at $1.90 per gallon.

Energy markets were moderately higher as US and Iranian officials are reportedly set to meet in Pakistan on Tuesday.

Rhett Montgomery, DTN analyst, said that soybeans led the way higher, primarily borrowing strength from the soybean oil market.

Montgomery said that firm crude oil and diesel futures certainly played a role, along with continued trend-based buying as traders remain very bullish on soybean oil demand prospects in light of last month's bullish Environmental Protection Agency mandates.

"The state of negotiations in the Middle East and subsequent status of trade through the Strait of Hormuz continues to cast a large shadow over the soybean market (and markets in general)," Montgomery stated in a daily note.

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