Tough week for Palm oil and so other edible oils

Sustainability of Palm oil has been the hot topic this week after UK advert from Iceland was banned. I wont got into the argument over the advert but its had an effect on the perception of Palm oil and certainly raised awareness. So probably no surprise that RSPO at their conference have now adopted new standard for sustainable Palm oil which now bans all deforestation. Some say its been too long in coming but its here. They have also added in new rules about workers wages and welfare at the same time. But with traders still talking about a glut in supply continuing through till end first quarter next year its unlikely to lift prices yet. But with an ‘El Nino’ event now 70-80% likely for the first quarter of 2019 along with now even greater push for sustainable Palm oil its looking like prices could start to rise by the end of that first quarter. So whilst the low point in edible oils is not over yet we can now maybe see where the price increases will come. Coconut oil continues also to trade much weaker but again farmers in the Philippines are talking about less harvesting due to the current low price. Will prices drop any lower though or is this really the bottom?

Desiccated prices have been trading even weaker as suppliers now are chasing buyers. But with uncertainty caused by such things as Brexit and Trump trade wars so buyers are being slow to commit which is pushing those prices down further. But we are hearing that some cheap shippers in Indonesia are now saying prices are so low that they will close factories till prices recover. We may be coming to an end of the oversupply. Like edible oils the low prices have not yet come to an end and will likely remain weak into 2019 but we can see where price rises will come from.