Biofuels

Last week Biofuels were the hot topic of discussion and also driving the market. Last month the US announced that they would look for a 50% increase in biodiesel blending by 2017. During the week Malaysia then joined Indonesia in announcing that they will now aim for a blend percentage of 10% up from the current 5-7%. Indonesia announced early this year they would aim for a 15% blend. But stock piles of edible oils remain high along with good crop production which have helped to stop prices running away. Also the comment that all these are targets set without much detail on how they will be met. Coconut oil has continued to hover around the $1130-50 mark as current good supply is mixed with dry weather in Philippines which will hit production towards the end of this year into first quarter 2016.

Desiccated prices remain weak at the moment as a continued glut in supply weigh’s down the market. With cheaper sources of VCO coming from Sri Lanka, Indonesia and even Vietnam pushing down those prices as well. But with the dry weather in the Philippines at the moment just how long will this glut continue for?