• +923 343206 986
  • Contact@btrams.com
  • Pakistan

Palm Oil : Malaysian palm oil forecast  gave up early gains on Tuesday, as traders weighed forecasts of rising production against strong demand from top buyer India ahead of a key festival there.

The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange had fallen 33 ringgit, or 0.89%, to 3,667 ringgit ($805.58) a tonne by the midday break, after rising 1.5% in early trade.

AS THE MALAYSIA’S SEPT 1-20 PALM OIL EXPORTS SEEN AT 866,984 TONNES VERSUS AUG 1-20 AT 622,180 (up +244,804 or 39.35%) TONNES -AMSPEC

The contract has declined nearly 6% in the past four sessions. The market is trading both sides with a weaker ringgit and expectations of higher September exports lifting the market in early deals, a Kuala Lumpur-based trader said.

While Indonesian palm oil producers are whittling down their hefty inventory overhang with discounts versus rivals and aggressive sales to India, where demand is picking up for next month’s Diwali festival, industry officials said.

Backed by Jakarta’s waiver of palm oil export levies, which was recently extended to Oct. 31 and reversed course from an export ban in May that had shut them out of global trade, producers are moving in to lighten up their stocks at tempting prices.

And India, the world’s biggest importer of vegetable oils, is buying – offering potential support to benchmark palm oil futures prices while threatening to undercut imports of rivals soyoil and sunoil.

“India has been aggressively buying palm oil forecasts from Indonesia since prices are attractive and festival demand is approaching,” said Sandeep Bajoria, the chief executive of vegetable oil brokerage and consultancy Sunvin Group.

“We are expecting imports of 2 million tonnes between August to November.”

That would be triple India’s palm oil imports from Indonesia, the world’s largest producer, in the previous four months, from April to July, according to data compiled by trade body The Solvent Extractors’ Association of India (SEA).

The momentum in shipments could help to bring Indonesia’s palm oil stocks, which ballooned to 6.69 million tonnes by end-June from around 4 million tonnes at end-2021, back to 4.5 to 5 million tonnes by end-September, said Eddy Martono, Secretary General at the Indonesian Palm Oil Association (GAPKI)

Leave a Reply

Your email address will not be published. Required fields are marked *

en English
X