MARKET DEVELOPMENT
Palm Oil Exports From Indonesia Drop on Weak India, China Demand
Palm Oil Exports From Indonesia Drop on Weak India, China Demand
17/07/2013 (Bloomberg) - Palm oil shipments from Indonesia, the largest producer, unexpectedly declined last month to the lowest level since April because of reduced purchases by India and China, the top buyers.
Exports of palm and kernel oils fell 11 percent to 1.62 million metric tons from 1.82 million tons in May, data from the Indonesian Palm Oil Association showed today. That compared with 1.25 million tons shipped in June 2012, according to the data. The median estimate in a Bloomberg survey published yesterday was for a gain of 2.2 percent from May to 1.86 million tons.
Palm has lost 27 percent in Kuala Lumpur over the past year, touching a two-month low yesterday, as supply of the commodity used in everything from cooking oil to biofuel outpaced demand. World stockpiles will jump 21 percent to a record 9.5 million tons in 2013-2014, the U.S. Department of Agriculture estimates.
“Fundamentally, global palm oil demand is still weak,” the growers and refiners group known as Gapki said in a statement today. Shipments declined because of a weak Indian rupee and a slowdown in China’s economy, it said.
Sales to India fell 31.5 percent to 404,520 tons in June from a month earlier and to China dropped 9 percent to 170,570 tons, the group said.
The Indian rupee fell to a record 61.2125 per dollar on July 8, making imports expensive for the biggest buyer of palm oil. China’s economic growth slowed for a second quarter to 7.5 percent in April-to-June, according data yesterday from the National Bureau of Statistics.
Price Decline
Palm oil for September delivery traded 0.2 percent lower at 2,268 ringgit ($711) on Bursa Malaysia Derivatives today. Futures touched 2,234 ringgit yesterday, the lowest level for the most-active contract since May.
First-half shipments from Indonesia rose 23 percent to 10.6 million tons, according to Bloomberg calculations based on today’s data from Gapki. Pakistan bought 44,250 tons, up 157 percent from May, to meet demand for the Muslim fasting month of Ramadan that started this month and the Eid al-Fitr festival that falls in August, the group said.
Reserves in Indonesia probably contracted 7.7 percent to a one-year low of 2.4 million tons last month, the Bloomberg survey showed. Gapki does not issue stockpile and output data. Inventories in Malaysia, the second-biggest producer, fell 9.4 percent to 1.65 million tons in June, the lowest since March 2011, the country’s palm oil board said July 10.
Exports of palm and kernel oils fell 11 percent to 1.62 million metric tons from 1.82 million tons in May, data from the Indonesian Palm Oil Association showed today. That compared with 1.25 million tons shipped in June 2012, according to the data. The median estimate in a Bloomberg survey published yesterday was for a gain of 2.2 percent from May to 1.86 million tons.
Palm has lost 27 percent in Kuala Lumpur over the past year, touching a two-month low yesterday, as supply of the commodity used in everything from cooking oil to biofuel outpaced demand. World stockpiles will jump 21 percent to a record 9.5 million tons in 2013-2014, the U.S. Department of Agriculture estimates.
“Fundamentally, global palm oil demand is still weak,” the growers and refiners group known as Gapki said in a statement today. Shipments declined because of a weak Indian rupee and a slowdown in China’s economy, it said.
Sales to India fell 31.5 percent to 404,520 tons in June from a month earlier and to China dropped 9 percent to 170,570 tons, the group said.
The Indian rupee fell to a record 61.2125 per dollar on July 8, making imports expensive for the biggest buyer of palm oil. China’s economic growth slowed for a second quarter to 7.5 percent in April-to-June, according data yesterday from the National Bureau of Statistics.
Price Decline
Palm oil for September delivery traded 0.2 percent lower at 2,268 ringgit ($711) on Bursa Malaysia Derivatives today. Futures touched 2,234 ringgit yesterday, the lowest level for the most-active contract since May.
First-half shipments from Indonesia rose 23 percent to 10.6 million tons, according to Bloomberg calculations based on today’s data from Gapki. Pakistan bought 44,250 tons, up 157 percent from May, to meet demand for the Muslim fasting month of Ramadan that started this month and the Eid al-Fitr festival that falls in August, the group said.
Reserves in Indonesia probably contracted 7.7 percent to a one-year low of 2.4 million tons last month, the Bloomberg survey showed. Gapki does not issue stockpile and output data. Inventories in Malaysia, the second-biggest producer, fell 9.4 percent to 1.65 million tons in June, the lowest since March 2011, the country’s palm oil board said July 10.