Overheating market

The predication that Palm oil will rise all the way through till the summer was made by a number of sources and that we could see record prices levels come June/July. Well Palm has pretty much climbed since that point pushing up other edible oils in its wake. The current dry weather in Asia has been to blame as we see lower crops and so inventories dropping. Coconut oil has risen this week over $100 or over 15% which is really pushing up desiccated prices. Dry weather in the Philippines along with strong sales seem to be to blame. Continued shortages of raw nuts looks set to keep prices firm for some time.

Desiccated prices have risen sharply this week as nervous buyers worried about even higher prices to come book as far forward as possible. But with stories that some major companies are still uncovered there is plenty of buyers out there. Some buyers are rather annoyed that they have missed the lower price levels. What will be interesting is will next week see even higher prices? Certainly is coconut oil goes above the $1700 level that looks almost definite.