Caixin Futures: Oil sector remains volatile and weak; palm oil rises 1.27% driven by El Niño concerns

(1) Oils: Today, the palm oil 2609 contract rebounded from its lows to close up 1.27%, with the late session boosted by the El Niño theme and unusual price movements in rubber and 20# rubber. The Australian Bureau of Meteorology has confirmed an El Niño event, with half the models indicating a strong to very strong level, fueling market speculation about reduced production in the main producing regions in the future. Exports from Malaysia in early June rebounded significantly compared to the previous period, and with the Indonesian rupiah appreciating and bearish sentiment in the spot market easing, fundamental support was established. However, persistently weak crude oil prices are suppressing oils, and rainfall in Southeast Asia remains normal in the short term, so the actual reduction in output due to El Niño has not yet materialized, making the sustainability of bullish factors questionable.(2) Price support has appeared along the lower range of the market, with near-term contracts expected to remain within the range and distant contracts driven by stronger climate forecasts. For new positions, it is recommended to wait and see. In the spot market, declines outnumber rises. Guangzhou 24-degree palm oil increased by 20 yuan to 9,130 yuan; soybean oil fell by 30 yuan to 8,560 yuan; Jiangsu GMO rapeseed oil dropped by 60 yuan to 10,170 yuan.(3) Soybean meal: The increase in supply pressures from South America and favorable weather in the primary US soybean-producing regions have led to weaker US soybean prices, lowering import costs. Domestic pressure from arriving imported soybeans continues to build, oil plants are ramping up operations, and soybean meal inventories keep accumulating. On the demand side, deep losses in hog breeding and ample feed enterprise inventories are limiting speculative hoarding, sustaining a supply-strong and demand-weak pattern, and spot prices remain weak. For trading, maintain a strategy of selling on rallies and mainly observe on single trends.(4) Corn: The fundamentally loose structure persists. The listing of wheat and germinated wheat along with increased news of stock releases are increasing supply pressures; downstream enterprises have ample inventories and purchase as needed, with wheat's listing crowding out corn demand. In a supply-strong and demand-weak environment, corn spot prices are under pressure and run weakly. Sell on rallies on a single trend basis; there is no clear driving force for arbitrage, so watching is advised.(5) Hog: The daily theoretical slaughter volume in June-July continues to increase, while the decline in slaughter weight is limited in the short term, and some secondary breeding pigs have not yet been fully shipped, so supply pressures persist. The Dragon Boat Festival offers limited support to pork demand, and the stocking phase is largely over, with no highlights in short-term consumption. June-July is a seasonal lull for hog consumption, with weak demand expected in the near to mid-term. In the medium to longer term, breeding profits may see some recovery, but the scope is limited. Mainly observe on single trends, enter reverse arbitrage.(6) Eggs: Recently, spot egg prices have pulled back, with long positions exiting the market and prompting a price correction; egg calendar spreads have also declined and adjusted. In the short term, pay attention to stocking conditions for the Dragon Boat Festival demand and to the price difference between large and small eggs. In the longer term, the significant increase in chick replenishment in February has led to a possible recovery in the laying hen population, and combined with a year-on-year increase in breeding profits, participation should be cautious. Observing is recommended for single trend, arbitrage, and options trading.