Mixed signals as Palm Oil dips and rallies
July 18, 2017
So Palm oil has been tracking Soya in the last few weeks as Soya has…
Weaker Palm oil might not mean weaker coconut
So Palm oil this week has been trading slightly down as continued reports of better crops and increased stocks. Also with increased Soya planting in the US and increased predictions of South American harvest of Soya have helped depress the market. Palm is predicted to be weaker now for the next quarters as these factors impact along with rumour that both the US and EU will change bio-fuel blending regulations to restrict the use of Palm oil as a bio-fuel. For the most part coconut oil though has shrugged off weaker oils as demand has remained strong and supply continues to be hampered by dry weather in Sri Lanka and Indonesia.
Desiccated prices are actually up slightly at the moment as heavy demand and labour shortages slow production in the Philippines. Sri Lanka is still suffering greatly from reduced supply caused by dry weather along with Indonesia. Buyers are covering froward as shippers sell out now till second half of the year. Its likely unless the situation improves (again unlikely) then prices might have to rise in the near term.
