Asian palm oil prices to remain steady this week
Asian palm oil prices to remain steady this week
KUALA LUMPUR (Reuter): Asian palm and laurics oil prices will
hold steady this week, regional traders said yesterday.
They said Indonesian palm prices would be fueled by a supply
shortage but that their upside could be capped by government
intervention.
Indonesian traders said market operations by state commodities
regulator Bulog, that began last Monday, were expected to put
pressure on prices that rose sharply last week due to supply
woes.
"The market is short of palm olein," one Indonesian trader
said. "I expect the shortage to ease slightly this week but
prices are likely to stay firm."
Another trader in Indonesia said Bulog, through a major
refiner, was selling palm olein in one-liter bags at Rp 1,300
directly to consumers.
"Bulog's market operations are expected to begin having an
impact on prices," the Indonesian trader said. "The operations
are expected to become more aggressive this week."
Indonesian palm olein ended last week at Rp 1,400-1,410/kg, up
from Rp 1,330-35 previously.
Expectation of more demand news and supportive export
estimates could steady Malaysian palm prices but traders said the
long-term outlook may be bearish on increasing output in the
coming months.
Pakistan may return to the market this week to issue fresh
tenders for palmoil for March shipment, traders said. Last week,
Pakistan scrapped its tender of 6,000 tons of RBD palmoil for the
second half of the March shipment because of high prices offered
by the sellers.
SGS (M) Sdn Bhd on Friday estimated March 1-15 exports at
321,325 tons, up from 234,493 tons in February 1-15. The market
expects more export estimates from SGS for March 1-20.
"Prices may hold steady on supportive export estimates but in
the long term, prices will drop on the back of higher output," a
dealer in Kuala Lumpur said. Production in March will rise to an
estimated 600,000-610,000 tons from February's 427,508 tons
because of improved weather conditions and the start of the
seasonal upward cycle.
In the Philippines, coconut oil prices will drift sideways
this week with many players preparing to attend the National
Institute of Oilseeds Products (NIOP) convention in Arizona.
Trade in the market will likely ease in the absence of news
with the approach of the long Easter holidays during the first
week of April, Filipino traders said.
Prices for nearby months dropped about US$10 to $722 CIF
Europe from the previous week. "It may be quiet because of the
NIOP convention in Arizona and then you're going into Easter. It
will stay within the $700-720 range until after Easter," a
Filipino trader in a major company said.
Coconut oil will be well-supported at $700 with tight supplies
of copra keeping prices firm, Filipino traders said.