Market News Monday 9th September 2024

Shipping News

Container spot freight rates between Asia and Europe have dropped

Rates on the Asia-North Europe and Asia-Mediterranean routes dropped 14% and 12%, respectively, reflecting decreased demand after a shipping peak earlier this year. Carriers are grappling with overcapacity, leading to increasing instances of blank sailings.

July trade volumes from Asia to Europe also fell, signalling a wider market cooldown. Projections for September show further reductions, exacerbated by the Golden Week slowdown. Some analysts predict that blank sailings are the only tool left to slow the rate decline.

Transpacific routes also experienced mild rate drops despite potential disruptions like U.S. dock strikes. However, a rate war on eastbound transpacific trades is intensifying due to growing overcapacity, with non-alliance carriers slashing rates to maintain utilisation.

Price Trends and Market Dynamics

International coconut oil prices have seen substantial gains recently. In the Rotterdam market, prices for coconut oil increased by $55.63 per metric ton (MT), reaching $1,680.63/MT CIF for September/October shipments. This marks a steady recovery after previous quieter trading.

The price premium of coconut oil over palm kernel oil has also widened, averaging $186.28/MT compared to last week’s $160.49, indicating stronger market demand.

Export Growth Among Leading Producers

In the first four months of 2024, exports of desiccated coconut from the top three producers, the Philippines, Indonesia, and Sri Lanka, rose by 16% compared to the same period last year. The Philippines led with a 23.2% increase in export volumes, accounting for more than half of the total, while Sri Lanka’s exports surged by nearly 25%.

Global Coconut Oil Market Outlook

As we move into the latter half of 2024, coconut oil prices may continue to rise due to limited supplies from key producing countries like the Philippines. Additionally, the growing price premium over palm kernel oil further highlights coconut oil’s unique positioning in the vegetable oil market.