The soybean oil basis is the difference between the spot price and the futures price of the soybean oil commodity at a specific time and place. It is calculated as the spot price minus the futures price. If the spot price is lower than the futures price, the basis is negative; if the spot price is higher than the futures price, the basis is positive.

1. Factors affecting the basis

1. Quality

Since the futures contract stipulates that the goods to be bought and sold are benchmark grade goods, the quality of the actual spot transaction is different from the The grades of futures contracts specified by the exchange are often inconsistent, so this quality difference is included in the basis.

2. Region

The delivery location of the goods stipulated in the futures contract of the futures exchange is the standard delivery location specified by the exchange, but the delivery location of the actual spot transaction is often not the same as that of the futures contract. The delivery locations specified by the exchange are consistent, so the freight price difference between the two delivery locations creates a certain basis.

3. Time

Since the delivery time of spot transactions is often inconsistent with the month of futures delivery, this results in a time difference between futures prices and spot prices. The time impact basis is mainly reflected in warehousing costs. Specific costs include inventory fees, insurance premiums and interest. At different locations in the spot market, the size of the basis is often fixed within a certain range; traders can predict the basis and combine it with futures prices to judge the forward spot price.

2. The basis is the difference between the spot price minus the futures price. Generally, the basis is negative. A negative basis does not mean that futures investors are optimistic about the future market. Changes in the basis are of great significance for arbitrage and hedging. The basis narrows or even turns positive when the following situations occur: 1. The spot price remains relatively strong or even exceeds the futures price; 2. The market is relatively pessimistic about the future trend of the product, causing the futures price to be relatively weak. Therefore, the narrowing of the basis indicates that the futures market is pessimistic about the price trend, and the widening of the basis indicates that the market has become optimistic about the future price trend. In theory, the basis should move in the opposite direction to the price trend. Judging from the performance of index futures, there is no obvious pattern in the reverse changes in basis changes on that day and the price trend on that day and the price trend on the next trading day.