Slow market

Whilst the idea of El Nino weighs heavily on peoples minds its effect on the market has so far had a much smaller impact. Crude oils prices are low because of both a glut in supply but also a belief that demand will be lower next year as countries struggle with growth. Its this perception of slower growth world wide next year that’s also holding back Palm oil from rising as supply slows. Coconut oil prices are being held back at the moment and whilst crops are slowing prices are stable with this perceived lower demand.

Oversupply is the real issue at the moment with desiccated prices. Shippers have extra capacity but with more and more getting involved in VCO so they turn to produce desiccated once more. So whilst prices should be rising as raw nut supply falls its not the case and prices are holding even. But for how long can extra supply hold off the eventual increase in desiccated prices?