In domestic market CPO nudged higher tracking firm global cues. Spot market demand also improved which supported the up trend. Traders however remained cautious as stockpiles are still high. India's veg oil imports increased drastically in January and this may pressurize prices in the log run. Palm Oil prices are also supported by its discount to Soy Oil which boosted demand.
CPO edged higher in the opening trade in international market supported by improving export demand in the first 15 days of February. The numbers suggest that Malaysia's new export tax structure has helped to boost shipments as Malaysian exporters enjoy tax advantage over Indonesia. Cargo surveyors said exports surged mainly due to an up tick in outbound sales to major Palm Oil buyers, China and the European Union.
Prices eased from elevated levels in futures market soon after Malaysia's announcement came that it will raise export taxes on Crude Palm Oil shipments in March. In a circular issued on Friday Malaysia reported that it will set CPO export duties at 4.5% in March after two consecutive months of no duties that boosted crude shipments from Malaysia and helped to ease stockpiles. Crude Palm Oil witnessed a slight uptrend this year after falling heavily last year amid speculation that holdings will drop as exports gain and supply shrinks.
Malaysia's CPO exports in March are likely to be much lower due to higher tax rate and Indian importers have bought quite a fair bit in January. Palm oil port stocks at Indian ports are also filing up and therefore buying may slow down soon. But at the same time buying from China may start buying again from next week after markets open after long new year holidays.
Palm Oil shipments from Indonesia, may decline to the lowest level in four months in February as more buyers turn to Malaysia after it extended duty free shipments to clear record stockpiles. Indonesia will release its estimate for January exports at the end of this month, and follow with the February export tax figure of 9 % in March.
News for Use
Robobank expects CPO futures to find support above MYR 2,400/ton for the remaining time in 1st quarter to encourage demand. They also said that current low prices will continue to stimulate export demand and draw down inventories supporting prices. The bank forecasts CPO prices to average MYR 2,700/ton in the second quarter of 2013, 12.5% from its projection for 1Q 2013.
Monday, February 18, 2013
Friday, February 8, 2013
Market Intelligence Crude Palm Oil 8th February, 2013
Market Intelligence
Palm Oil prices in international as well as domestic markets traded steady. Prices were almost flat in range bound trade as traders remained cautious ahead of the Lunar New Year holidays. Market participants were also waiting for USDA monthly supply and demand report later in the day which may show tighter Soybean stocks. Lower production of Soybean and oil could shift demand variably to Palm Oil. Sentiments were positive on optimism that export demand could go up for the tropical oil. The wide discount between Palm Oil and rival Soy Oil continues to exist. This is attracting price sensitive buyers to the cheaper available option, Palm Oil.
Malaysian markets will be closed on Monday and Tuesday for Lunar New year holiday. MPOB will publish January crop data after trading resumes on Wednesday. Market participants expect stockpiles to ease slightly from December's record high, as export demand has recovered. Traders are also eying export estimates for first 10 days by cargo surveyors scheduled on Feb. 13.
Palm Oil may witness a range bound choppy trade next week amid key data releases. Major Palm Oil consumer China, will be closed for whole week for Lunar New Year holidays.
News for Use
Malaysia's prominent investment bank lowers the average CPO price for 2013 by 12% to MYR2,500/ton from a previous forecast of MYR2,850/ton, reiterating its underweight rating on the Palm Oil sector. They also forecast a surge in Malaysian Palm Oil inventories to 2.82 million tons by the end of the year, vs 2.38 million tons reached in 2012.
Palm Oil prices in international as well as domestic markets traded steady. Prices were almost flat in range bound trade as traders remained cautious ahead of the Lunar New Year holidays. Market participants were also waiting for USDA monthly supply and demand report later in the day which may show tighter Soybean stocks. Lower production of Soybean and oil could shift demand variably to Palm Oil. Sentiments were positive on optimism that export demand could go up for the tropical oil. The wide discount between Palm Oil and rival Soy Oil continues to exist. This is attracting price sensitive buyers to the cheaper available option, Palm Oil.
Malaysian markets will be closed on Monday and Tuesday for Lunar New year holiday. MPOB will publish January crop data after trading resumes on Wednesday. Market participants expect stockpiles to ease slightly from December's record high, as export demand has recovered. Traders are also eying export estimates for first 10 days by cargo surveyors scheduled on Feb. 13.
Palm Oil may witness a range bound choppy trade next week amid key data releases. Major Palm Oil consumer China, will be closed for whole week for Lunar New Year holidays.
News for Use
Malaysia's prominent investment bank lowers the average CPO price for 2013 by 12% to MYR2,500/ton from a previous forecast of MYR2,850/ton, reiterating its underweight rating on the Palm Oil sector. They also forecast a surge in Malaysian Palm Oil inventories to 2.82 million tons by the end of the year, vs 2.38 million tons reached in 2012.
Tuesday, February 5, 2013
Market Intelligence Crude Palm Oil 5th February, 2013
Market Intelligence
Crude Palm Oil inched lower globally on concerns of uncertainty in Europe which stirred in negative sentiments. Political instability in Spain and Italy prompted investors to lock in gains. Downfall was, however, limited on fears of unpleasant weather in major Soybean growing regions in Argentina and expectations for improving Palm Oil exports.
Palm Oil exports are likely to improve in coming months, driven mainly by Malaysia's move to revamp its existing export duty structure as part of a plan to improve competitiveness and grab back market share from top producer Indonesia. Malaysia's export tax changes will aid refiners in the country as margins will improve. There are also forecasts of higher shipments to emerging markets such as Myanmar and Iran as consumption rises there.
Malaysia expects brighter days for Palm refiners on account of better margins as they ramp up production. Indonesia's move of higher export taxes will act as a blessing for refiners in Malaysia. More exports will bring down the stockpiles which will ultimately raise the price of CPO. Exports may go up this year as the Malaysian government has already discontinued the duty free export quota beginning last month. The use of B10 bio diesel containing CPO from middle of next year is also expected to stabilize the prices.
Palm Oil may trade volatile with range bound movement as traders may move to the sidelines ahead of the Lunar New Year holidays. The China markets are expected to slow down next week ahead of the Chinese New Year which falls on February 10, 2013. Investors also remain cautious over demand for Malaysian exports, even though Chinese authorities haven't refused shipments after imposing stricter quality control measures. Stockpiles in January are also close to December's record high.
Crude Palm Oil inched lower globally on concerns of uncertainty in Europe which stirred in negative sentiments. Political instability in Spain and Italy prompted investors to lock in gains. Downfall was, however, limited on fears of unpleasant weather in major Soybean growing regions in Argentina and expectations for improving Palm Oil exports.
Palm Oil exports are likely to improve in coming months, driven mainly by Malaysia's move to revamp its existing export duty structure as part of a plan to improve competitiveness and grab back market share from top producer Indonesia. Malaysia's export tax changes will aid refiners in the country as margins will improve. There are also forecasts of higher shipments to emerging markets such as Myanmar and Iran as consumption rises there.
Malaysia expects brighter days for Palm refiners on account of better margins as they ramp up production. Indonesia's move of higher export taxes will act as a blessing for refiners in Malaysia. More exports will bring down the stockpiles which will ultimately raise the price of CPO. Exports may go up this year as the Malaysian government has already discontinued the duty free export quota beginning last month. The use of B10 bio diesel containing CPO from middle of next year is also expected to stabilize the prices.
Palm Oil may trade volatile with range bound movement as traders may move to the sidelines ahead of the Lunar New Year holidays. The China markets are expected to slow down next week ahead of the Chinese New Year which falls on February 10, 2013. Investors also remain cautious over demand for Malaysian exports, even though Chinese authorities haven't refused shipments after imposing stricter quality control measures. Stockpiles in January are also close to December's record high.
Subscribe to:
Posts (Atom)