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Date
 28/09/2021
News Source
 The Hellenic Shipping News
Headline
 Edible oil prices could ease, sharp drop unlikely

The Hellenic Shipping News (27/09/2021) - Edible oil prices could ease in the next to six to 12 months on improving supplies and benchmark palm prices could moderate from near record levels to average slightly below 4,000 ringgit ($956.60) per tonne in 2022, a top industry analyst said.

“I expect a gentle easing of edible oil prices in the next 6 to 12 months,” James Fry, chairman of commodities consultancy LMC International, told the Globoil India conference on Friday.


“But barring macroeconomic contagion from China’s debt bubble and growing raw material cost inflation worldwide, the fall will not be dramatic.”


The benchmark crude palm oil contract FCPOc3 has risen nearly a quarter this year, rallying for a third straight year as a pandemic-induced labour shortage crimped output in Malaysia, the world’s second largest producer.


The contract touched a record high of 4,560 ringgit a tonne in mid-August.


Top producer Indonesia’s output of palm oil is likely to rise in coming months, Fry added, but it will be capped by droughts and poor maintenance. Malaysia’s output will continue to suffer from the lack of labour in the short term, he said.


Soyoil demand for food purposes is recovering from coronavirus disruption, but its use in biodiesel is falling, especially in the United States, Fry said.


President Joe Biden’s administration is considering big cuts to national biofuel blending requirements.


Soybean production is likely to rise but that is unlikely to swell supplies of soyoil as the pace of crushing is inhibited by lower demand for meal, Fry said.


A sharp rise in production of sunflower oil in the Black Sea region could pull its premium over palm oil below $100 per tonne from more than $250 this year, he added.


Sunflower oil could trade at a discount to soyoil and lure buyers such as India, he said.


Read more at https://www.hellenicshippingnews.com/edible-oil-prices-could-ease-sharp-drop-unlikely/



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