In the past two months, the price of palm oil has attracted many attention in the market, and even appeared on CCTV Finance. Driven by continued tight supply and strong exports, the drama of palm oil "punching soybean oil and kicking vegetable oil" has been staged for a long time. However, as of April 16, the main palm oil futures contract has fallen nearly 6% since the beginning of April.
On April 15, the Malaysian Palm Oil Board released monthly report data showing that at the end of March, Malaysian palm oil inventories fell 10.68% from the previous month to 1.71 million tons, the lowest level in 10 months, production increased by 10.57% from February to 1.39 million tons, and exports climbed 28.61% to 1.32 million tons.
Strong exports and rapid decline in inventories should have boosted prices, but after the announcement, palm oil fell instead of rising, reflecting the fact that the market has already fully digested the low inventory. After coming out of Ramadan, the previous bullish will immediately turn short, for example, export demand is difficult to maintain strong, and palm oil production in the producing areas will increase rapidly.
The spot price of palm oil fell by 200~290 yuan/ton compared with a week ago, on April 16, Jiangsu 24 degrees palm oil price was 8360 yuan/ton, Guangzhou 8230 yuan/ton, Shandong 8430 yuan/ton, Tianjin 8390 yuan/ton.
At present, the biggest dilemma of palm oil is that the price difference with other competing oils and fats is in an unreasonable range, the spot price spread of soybean palm oil has been inverted for nearly a month, and the price spread of vegetable palm oil has been inverted for nearly 20 days. At present, the terminal has replaced a large number of palm oil with soybean and vegetable oil, and the import volume of palm oil by some enterprises has also dropped to 30% of previous years.
The same is true for international markets. India, the world's largest importer of vegetable oil, imported 485,000 tonnes of palm oil, 219,000 tonnes of soybean oil and 446,000 tonnes of sunflower oil in March, up -2.5%, 26% and 50% month-on-month, respectively, according to data released last week by the Indian Petroleum Refining Association. As international palm oil prices rise, cheaper sunflower oil is eroding palm oil's share. In the future, a large number of South American soybeans will be listed, Argentina will increase the supply of soybean oil, and the oil demand will be more crowded.
Supply and demand will automatically correct distorted prices, and since last week, the spread between soybean palm oil and rapeseed palm oil has been repaired.
On April 16, Jiangsu first-grade soybean oil was quoted at 7850~7900 yuan/ton, Guangzhou in Guangdong 7990~8050 yuan/ton, Guangxi 7830~7860 yuan/ton, Shandong 7770~7900 yuan/ton, Fujian 7850 yuan/ton, Guangdong third-grade rapeseed oil price 7950 yuan/ton, Guangxi 7900 yuan/ton, Fujian 7950 yuan/ton, Jiangsu Nantong 8200 yuan/ton, Sichuan Chengdu 8300 yuan/ton.
At present, the spot price of palm oil is still higher than that of soybean and vegetable oil, and this repair is bound to continue, and palm oil will drag down other oil products in the oil sector.
Domestic oil inventories have been declining for several months. According to the statistics of the Iron and Steel Federation, as of April 12, the total commercial inventory of soybean oil, palm oil and vegetable oil in key areas of the country was 1,737,790 tons, a decrease of 3.84% from the previous week and a year-on-year decrease of 7.76%. Palm oil is expected to continue to go to the warehouse due to the poor import profit margin and the lack of ship purchases, while soybean oil is expected to usher in an inventory inflection point due to the arrival of a large number of Brazilian soybeans and the rebound in the operating rate; On the whole, domestic oils and fats will continue to go to storage, but the speed has slowed down.
The current bright card is that palm oil has entered the seasonal production cycle, South American soybeans are harvested quickly, and the global oilseed supply is relatively abundant, and the potential risk point is that with the start of the sowing of American beans, the weather speculation in the producing areas will come at any time, and the geopolitical crisis in the Middle East will also have a greater disturbance to crude oil, which will affect the vegetable oil market. There is indeed a need for a pullback after the sharp rise in oil, but among the many uncertainties, the space for its downward search may be relatively limited. (This article was originally published on the third page of the Grain and Oil Market News on April 18, 2024)
Source丨Grain and oil market newspaper
General Duty丨Liu Xinhuan Editor丨Congshen
