PALM NEWS MALAYSIAN PALM OIL BOARD Tuesday, 21 May 2024

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MARKET DEVELOPMENT
Palm oil to trade between RM4,000-RM5,000 a tonne until August- analyst Mistry
calendar09-03-2023 | linkThe Star Online | Share This Post:

08/03/2023 (The Star Online), Kuala Lumpur - Malaysian palm oil is expected to trade between RM4,000 and RM5,000 per tonne from now until August as Indonesia's ambitious biodiesel mandate will keep stocks tight in the first half of 2023, industry analyst Dorab Mistry said on Wednesday.

 

Benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange fell to RM4,195 a tonne by the midday break on Wednesday.

 

"The Indonesian B35 programme will keep stocks tight in the first half of 2023," Mistry told an industry conference.

 

Indonesia, the world's biggest producer of palm oil, raised the mandatory biodiesel blending level to 35% starting in February, from 30% earlier, to reduce diesel fuel imports amid high global energy prices and to reduce emissions.

 

In Malaysia, the world's second-biggest palm oil producer, stockpiles of the vegetable oil at the end of January expanded by 3.26% from the previous month to 2.27 million tonnes.

 

But Malaysian stocks could drop below 2 million tonnes because of output disruptions caused by heavy rainfall and rising exports after rival Indonesia imposed curbs on its exports, said Mistry, the director of Indian consumer goods company Godrej International.

 

The palm oil market is likely to be influenced by the "vagaries of climate" in 2023 as a new El Nino weather pattern is forecast to develop, he said.

 

An El Nino episode usually results in below-average rainfall in Indonesia and Malaysia, cutting yields and pushing up global prices.

 

"A new EL Nino could drive prices higher so as to destroy demand. Without El Nino, we can see lower prices after August," he said.

 

Sunflower seed production in Ukraine, the world's biggest exporter of sunoil, could fall this year by as much as 30% from a year ago because of the ongoing war with Russia, he said. - Reuters

 

https://www.thestar.com.my/business/business-news/2023/03/08/palm-oil-to-trade-between-rm4000-rm5000-a-tonne-until-august--analyst-mistry