Report Summary 1. Investment Rating for the Industry No investment rating for the industry is provided in the report. 2. Core Views - The outlook for US soybean oil consumption is positive due to bio - diesel policies, leading to a relatively strong performance in US soybean oil. However, the price of CBOT soybeans is under pressure because of favorable growing conditions for US soybeans. In China, high oil - mill operating rates have increased soybean oil supply, causing continuous inventory accumulation and limiting the upside potential of soybean oil prices [2]. - GAPKI data shows that Indonesia's palm oil inventory decreased by 4.27% month - on - month in May, driven by increased demand from India and China. But ASA data indicates that the export of Malaysian palm oil decreased by 15.2% month - on - month in the first half of July, suggesting a recent weakening in exports. In China, the rapid recovery of import profits for near - term shipments has led to active purchasing and an increase in domestic palm oil inventory. The supply - demand pattern of Malaysian palm oil is widening, which may limit the upside of palm oil prices [2]. - Due to the improvement in China - Australia trade relations, future imports of Australian rapeseed will increase domestic rapeseed supply, putting pressure on rapeseed oil prices. However, domestic rapeseed oil is expected to continue de - stocking. Current demand for rapeseed oil is low, maintaining a pattern of weak supply and demand and mainly following the trends of other oils [2]. 3. Summary by Relevant Catalogs Industry News - The growing conditions for US soybeans are good, putting pressure on the price of CBOT soybeans. Indonesia's palm oil inventory decreased by 4.27% month - on - month in May due to strong export demand, but the export of Malaysian palm oil decreased by 15.2% month - on - month in the first 25 days of July [5]. - As of the week ending July 20, 2025, the good - to - excellent rate of US soybeans was 68%, lower than the market expectation of 71% and the previous week's 70%, but the same as the same period last year. Indonesia's palm oil inventory in May decreased to 2.9 million tons, a 4.27% month - on - month decrease. Its export volume of palm oil and refined products reached 2.66 million tons, a nearly 50% increase from April and a 35.64% year - on - year increase. The production of crude palm oil in May was 4.17 million tons, lower than April's 4.48 million tons but a 7.2% increase from last year. The export volume of Malaysian palm oil products from July 1 - 25, 2025, was 896,484 tons, a 15.2% decrease compared to the same period in June [6]. Soybean Oil - According to Steel Union research, last week, the actual soybean oil production of sample oil mills was 438,000 tons, with an operating rate of 64.81%. The operating rate is expected to decline this week. As of July 18, the commercial inventory of soybean oil in key regions of China was 1.0918 million tons, a 4.04% week - on - week increase. Terminal consumption is weak, and the basis is weak. The supply pressure limits the upside of soybean oil prices [9]. Palm Oil - As of July 18, the commercial inventory of palm oil in key regions of China was 591,400 tons, a 5.04% month - on - month increase and a 23.49% year - on - year increase. Indonesia's biodiesel consumption has reached 7.42 million kiloliters this year, completing 47.5% of the 2025 quota. The new industrial consumption expectation has made palm oil prices run strongly. However, the supply - demand pattern of Malaysian palm oil is widening, which may limit the upside of palm oil prices [12]. Rapeseed Oil - As of July 18, the rapeseed crushing volume of major coastal oil mills was 59,000 tons, an increase of 22,000 tons from the previous period. The rapeseed oil inventory of major coastal oil mills was 92,500 tons, a decrease of 400 tons from last week. Due to tight raw material supply, oil mills are expected to maintain a low operating rate. The improvement in China - Australia trade relations will increase the supply of imported rapeseed, putting pressure on rapeseed oil prices [15]. Vegetable Oil Price Spread - The improvement in China - Australia trade relations and the expected increase in Australian rapeseed imports will lead to an increase in rapeseed supply. Rapeseed oil is relatively weak in the oil and fat sector [18]. 4. Next Week's Focus - USDA weekly crop growth report; Malaysian palm oil export report and production report [3]

Group 1 - Report title: Weekly Oil Report: Malaysian Palm Oil Inventory Build-up Slightly Exceeds Expectations, Focus on Australian Prime Minister's Visit to China [1] - Core events and market review: MPOB data shows that Malaysia's palm oil inventory at the end of June reached 2.03 million tons, a 2.4% increase month-on-month; Canada's rapeseed exports decreased by 72.1% to 48,400 tons in the week ending July 6; influenced by positive macro sentiment, oils rose significantly this week, but the momentum for further increase weakened after the rapid rise [4] Group 2 - International market - Malaysian palm oil: In June, Malaysia's palm oil inventory build-up slightly exceeded expectations, with production down 4.48% to 1.69 million tons and exports dropping to 1.26 million tons; SPPOMA data indicates that the production of Malaysian palm oil may increase month-on-month in July, and ITS predicts a 5.31% month-on-month increase in exports in the first 10 days of July [8] - International market - Canadian rapeseed: The international cost - performance of Canadian rapeseed declined, with exports decreasing by 72.1% week-on-week; the new planting area was adjusted down by 80,000 hectares; there is still a risk of drought, and Oil World predicts a potential production cut of about 1.86 billion tons [10] Group 3 - Domestic palm oil: As of July 4, 2025, the commercial inventory of palm oil in key regions across the country was 538,100 tons, a 0.13% week-on-week increase; the basis fluctuated weakly; the spot market trading was light; it's expected to have limited upward space and may experience a slight correction, maintaining a sideways movement overall [13] - Domestic soybean oil: In June, the soybean crushing volume of 111 plants was about 8.95 million tons, and the soybean oil output was about 1.7 million tons; as of July 4, 2025, the commercial inventory of soybean oil in key regions across the country was 1.0197 million tons, a 6.75% week-on-week increase; the basis was stable to slightly weak; the trading volume of soybean oil spot increased week-on-week but remained at a historically low level; it's expected to maintain a sideways movement [18] - Domestic rapeseed oil: Last week, the rapeseed crushing volume of major coastal oil mills was 47,000 tons; as of July 4, 2025, the coastal rapeseed oil inventory was 719,000 tons, a 28,000 - ton week-on-week decrease; the import profit of European rapeseed oil was significantly narrowed; the spot market was light; the market is watching the Australian Prime Minister's visit to China on Saturday [21] Group 4 - Strategy recommendation: Unilateral strategy - In the short term, the upward movement of oils is losing steam, may experience a slight correction, and maintain a sideways trend overall. Consider buying on dips. Arbitrage strategy - Hold. Option strategy - Hold [25] Group 5 - Weekly data tracking: The report also tracks data on Malaysian and Indonesian palm oil production, exports, and inventory, international soybean oil market, Indian oil supply and demand, domestic rapeseed oil and palm oil import profits, domestic oils' supply and demand, basis, and inventory [27]

Group 1: Report Industry Investment Rating - Not provided in the content Group 2: Core Views of the Report - The market may be tired of the previous weakening transactions and start new trades around the new marginal change of improved Indian demand and the continuous "buy oil, sell meal" in the US market. However, the current valuation is considered to have room to decline to provide a better long - position margin, so the market for palm oil is expected to be volatile. International soybean oil remains relatively strong, supporting the price of oils and fats. The short - term increase in soybean oil due to customs clearance sentiment lacks sustainability and may fluctuate downward [5]. Group 3: Summary by Relevant Catalogs 1. Last Week's Views and Logic - **Palm Oil**: After nearly two months of trading the game between strong current situation and weak expectations in the palm oil market, the market believed that the inventory - building story was temporarily fully traded. With the new variable of improved marginal demand in India, palm oil rebounded from the bottom and continued to rise sharply with the positive sentiment of US soybean oil. The palm oil 09 contract fell 3.00% last week [1]. - **Soybean Oil**: In April, the soybean crushing operation was consistently lower than expected, leading to a significant reduction in soybean oil inventory. The tight international soybean oil situation and the continuous speculation of RVO expectations supported the international oil price. The soybean oil 09 contract rose 2.99% last week [1]. 2. This Week's Views and Logic - **Palm Oil** - The market has traded the expectations of inventory - building in Malaysia after April and the doubts about Indian demand for nearly two months, and the trading funds for this contradiction have become somewhat dull. When the Malaysian market was effectively supported at 4000 ringgit, the domestic market also rebounded. New trades are being carried out around the new marginal variable of improved Indian demand and the continuous "buy oil, sell meal" in the US market, giving palm oil short - term rebound momentum [2]. - In terms of fundamentals, Malaysia's palm oil production in April is expected to recover to over 1.55 million tons, and high - frequency data show that the production in the first 20 days increased by 16% - 20%, which may push the April production above 1.6 million tons. ITS export data has improved significantly, with exports expected to be over 1.2 million tons, and the inventory in April is expected to continue to increase to over 1.65 million tons [2]. - Indonesia's refining profit has continued to decline significantly. With the stable and rising CPO tender price, the recovery of Indonesia's supply may be a false proposition. The market's pricing expectations for palm oil still come from the复产 in the producing areas. From the rapid increase in the price difference between Indonesia and Malaysia, Indonesia's production recovery may fall short of expectations [2]. - In the consumer areas, the widening of the international soybean - palm oil price difference, the less - than - expected export capacity of North America, and India's extremely low oil inventory ensure the consumption expectations of palm oil during the production - increasing season. The previous import demand for vegetable oils, especially palm oil, has been compressed to the limit, so the purchase and stocking of palm oil will start sooner or later [2]. - Overall, although there is a high probability of inventory - building in Malaysia from April to June, the inventory - building amplitude is not large, and Indonesia's inventory remains relatively tight. The B40 plan is expected to be fully completed. In this case, the soybean - palm oil price difference may face a correction. The market should observe the selling pressure in Indonesia, whether Malaysia's production recovers excessively, and India's subsequent purchasing willingness [2][4][5]. - **Soybean Oil** - Internationally, both the US and South American soybean oil inventories remain low. Funds continue to push up the oil - meal ratio in the US market based on the logic of "US first" and supporting US soybeans. Before the official confirmation of next year's blending obligation, this is difficult to disprove and may be hyped multiple times. If the US biodiesel operation is boosted by the optimistic expectations for next year, the international supply of soybean oil will gradually shift to palm oil. The market should pay attention to when the new South American soybean oil crop will put pressure on the price, and the weak performance of US soybean oil will at least occur when the biodiesel operation rate drops to a level that significantly affects the US soybean oil inventory [4]. - Domestically, the expected arrivals in May and June are over 11.5 million tons. If the operation is good, the soybean oil inventory will gradually increase from May to July but will decline after July, with more impact on soybean meal. Therefore, the short - term increase in soybean oil due to customs clearance sentiment lacks sustainability and may fluctuate downward. In the absence of more guidance on the weather of the new US soybean crop, there are few factors causing fluctuations in the fundamental market. The market needs to wait for changes in the sowing and growth situation of US soybeans, pay attention to subsequent weather - related speculations, and observe the arrival of selling pressure in the palm oil producing areas, the realization of weak expectations, and more certainties in the US soybean oil biodiesel sector [4][5]. 3. Disk Basic Market Data - **Prices and Price Changes**: The palm oil main - continuous contract rose 1.54%, the soybean oil main - continuous contract rose 3.47%, the rapeseed oil main - continuous contract rose 2.89%, the Malaysian palm oil main - continuous contract rose 1.53%, and the CBOT soybean oil main - continuous contract rose 2.86% [7]. - **Trading Volume and Open Interest Changes**: The trading volume and open interest of palm oil, soybean oil, and rapeseed oil all changed to different extents. For example, the trading volume of the palm oil main - continuous contract increased by 1,580,948 hands, and the open interest increased by 59,058 hands [7]. - **Price Differences**: The price differences between different varieties and contracts also changed. For example, the soybean - palm oil 05 price difference increased by 15.89%, and the palm oil 5 - 9 price difference decreased by 24.89% [7]. - **Warehouse Receipts**: The warehouse receipts of palm oil decreased by 1000 hands, the warehouse receipts of soybean oil increased by 2300 hands, and the warehouse receipts of rapeseed oil decreased by 157 hands [7]. 4. Core Data of Oil Fundamentals - **Malaysian Palm Oil**: The production in April is expected to recover to over 1.55 million tons, and the inventory is expected to continue to increase. The ITS export data has improved significantly, with exports in April expected to be over 1.2 million tons, and the inventory is expected to reach over 1.65 million tons [2][11]. - **Indonesian Palm Oil**: The refining profit has continued to decline significantly. The recovery of supply may be a false proposition, and the production recovery may fall short of expectations. The inventory in the first quarter is expected to rise slowly [2][12]. - **Indian Market**: The import profit of palm oil has improved rapidly, and the CNF price difference between soybean oil and palm oil has risen rapidly, increasing the import cost - effectiveness of palm oil [13]. - **European Union Market**: In 2025, the cumulative imports of palm oil and the four major oils and fats have decreased, with a cumulative decrease of 380,000 tons in palm oil imports and 640,000 tons in the four major oils and fats imports [13].