MARKET DEVELOPMENT
Palm Oil Climbs to One-Week High on Increasing Biodiesel Demand
Palm Oil Climbs to One-Week High on Increasing Biodiesel Demand
13/11/2013 (Bloomberg) - Palm oil advanced for a third day to the highest level in more than a week on speculation that demand for the tropical oil as feedstock will increase as Indonesia accelerates its biodiesel program.
The contract for January delivery climbed 0.7 percent to 2,618 ringgit ($816) a metric ton on the Bursa Malaysia Derivatives, the highest price for most-active futures since Nov. 4. Prices jumped the most since Aug. 26 yesterday on speculation that output in Indonesia and Malaysia, the biggest producers, will start tapering from November.
Wilmar International Ltd. submitted a tender proposal for Indonesian biodiesel, the Singapore-based company said today. Indonesia’s biodiesel consumption may more than double to six million tons in 2014, Sugiharto, president commissioner of state oil company PT Pertamina said on Nov. 9. The country raised blending rate for biodiesel in subsidized-diesel oil to 10 percent in September from 7.5 percent and the mandate will be imposed for non-subsidized diesel and industrial users, and 20 percent blending for power plants starting January.
“We are positive on the demand prospects for biodiesel in Indonesia, in view of the government plans to raise biodiesel blend in transport,” said Ivy Ng, an analyst at CIMB Investment Bank Bhd. in Kuala Lumpur. “Exports have been weak in the first 10 days, but expectations are that they will improve.”
Indonesia’s biodiesel capacity may jump to 8.8 million kiloliters by the end of 2015 from 5.6 million kiloliters this year, Paulus Tjakrawan, secretary general of the Indonesia Biofuel Producers Association said today.
Soybean oil for December delivery increased 0.3 percent to 40.89 cents a pound on the Chicago Board of Trade. Soybeans for delivery in January were little changed at $13.135 a bushel.
Refined palm oil for May delivery gained 1.2 percent to 6,300 yuan ($1,034) a ton on the Dalian Commodity Exchange and soybean oil advanced 0.5 percent to 7,220 yuan.
The contract for January delivery climbed 0.7 percent to 2,618 ringgit ($816) a metric ton on the Bursa Malaysia Derivatives, the highest price for most-active futures since Nov. 4. Prices jumped the most since Aug. 26 yesterday on speculation that output in Indonesia and Malaysia, the biggest producers, will start tapering from November.
Wilmar International Ltd. submitted a tender proposal for Indonesian biodiesel, the Singapore-based company said today. Indonesia’s biodiesel consumption may more than double to six million tons in 2014, Sugiharto, president commissioner of state oil company PT Pertamina said on Nov. 9. The country raised blending rate for biodiesel in subsidized-diesel oil to 10 percent in September from 7.5 percent and the mandate will be imposed for non-subsidized diesel and industrial users, and 20 percent blending for power plants starting January.
“We are positive on the demand prospects for biodiesel in Indonesia, in view of the government plans to raise biodiesel blend in transport,” said Ivy Ng, an analyst at CIMB Investment Bank Bhd. in Kuala Lumpur. “Exports have been weak in the first 10 days, but expectations are that they will improve.”
Indonesia’s biodiesel capacity may jump to 8.8 million kiloliters by the end of 2015 from 5.6 million kiloliters this year, Paulus Tjakrawan, secretary general of the Indonesia Biofuel Producers Association said today.
Soybean oil for December delivery increased 0.3 percent to 40.89 cents a pound on the Chicago Board of Trade. Soybeans for delivery in January were little changed at $13.135 a bushel.
Refined palm oil for May delivery gained 1.2 percent to 6,300 yuan ($1,034) a ton on the Dalian Commodity Exchange and soybean oil advanced 0.5 percent to 7,220 yuan.