The Chicago soybean complex extended gains on Tuesday, supported by a strong crushing pace and weakening crop conditions in the US.
The September soybean contract on the Chicago Board of Trade rose for a fifth consecutive session on Tuesday by 0.52% to $12.07 per bushel in early trade. The September CBOT soybean oil contract climbed 0.18% to 71.57 cents per pound.
The US soybean crush reportedly increased 1.08% month over month and 10.7% year over year to 216.6 million bushels in July, according to the National Oilseed Processors' Association.
Meanwhile, 61% of planted soybeans across 18 states were in good-to-excellent condition as of Aug. 16, data from the US Department of Agriculture showed. This is down from the previous week's 62% and the prior year's 68%.
Crop growing conditions are likely to benefit from rainfall and lower temperatures into September.
Chinese buying continued to provide upward market momentum, following a series of purchases despite high domestic inventories.
Chinese state-owned enterprise Sinograin will reportedly auction another 360,000 tons of soybeans, its fourth sale since July, to accommodate incoming US cargoes.
"Lower yield ideas and strong demand have accelerated a recovery in soybean futures," agriculture intelligence provider DTN said.
"In the near term, CBOT soybean futures continue to oscillate between supply concerns, weather developments, and export dynamics," price reporting agency MySteel said.
In Asia, Malaysian palm oil futures continued their rally as rival soybean oil strengthened, but gains were capped as the local currency firmed and export estimates showed mixed signals.
The Bursa Malaysia Derivatives' September crude palm oil contract inched up 0.59% to 4,616 Malaysian ringgit ($1,133.87) per metric ton. The October contract climbed 0.78% to 4,754 ringgit/mt.
The Malaysian ringgit firmed against the US dollar by about 0.1% on Tuesday, likely dampening export competitiveness due to resulting higher prices for foreign buyers.
Malaysian shipments in the Aug. 1-15 period reportedly showed mixed trends, with AmSpec Agri Malaysia estimating a 3.2% increase from a month earlier, while Intertek Testing Services assessing a 7.9% drop.
A narrowing price gap between soybean oil and palm oil weighed on demand for the latter, particularly in top buyer India, where the premium for soybean oil over palm oil has halved to around $50 per ton from the April level of more than $100 per ton, according to Indian financial news channel NDTV Profit.
Logistical disruption in the Black Sea, which has curbed arrivals of sunflower oil cargoes, have also supported India's soybean oil purchases, NDTV said.
The country's soybean oil imports are reportedly expected to reach 620,000 metric tons this month, up 46% from the current marketing year's monthly average.
Nonetheless, festive-driven demand could still boost India's palm oil purchases, which have surged month over month in July to 730,965 mt.
This week, "crude palm oil futures are expected to trade with a mildly bullish bias," financial services firm Phillip Capital said, noting resilient demand and prospects of tighter supply.
For far-month contracts, futures are still in contango, with February to May 2027 prices recently rising above 5,000 ringgit/mt, according to a Kuala Lumpur-based trader cited by the firm.
"On the forward curve, Indonesia's B50 policy and El Nino-related production-cut expectations continue to provide underlying support for far-month contracts," price reporting agency MySteel said.
In the US, September ethanol prices on the NYMEX jumped by a further 0.99% to about $2.04 per gallon on Monday, in line with the price movement of major biofuel feedstocks.