Palm & Veg Report, August 2019
We would love to be able to tell you the spot markets have been really busy over the last month but that would be in the words of Donald Trump, “fake news” because they have been anything but! The month of July turned out to be an incredibly gloomy and lifeless month and even though there have been pockets of activity here and there the chemical, vegetable oil and CPP markets all remain very routine. The benchmark 40,000 freight rate for palm into Rotterdam is presently ten dollars higher today compared to a year ago which surprised us to be honest, however the rates for intermediate size vessels on the same run remain virtually unchanged.
Dorab Mistry indicated in a recent speech that in 2019, World Palm oil production will be increased by at least 3.5 m in 2019. Malaysia is expected to produce 20.3 m this year and Indonesia is expected to rise to 45 m. A staggering 45 m tonnes of vegetable oil will go for Bio Diesel in 2019, 17 m from palm oil alone and some argue that producers are still far too dependent on bio diesel to support prices.