Palm & Veg Report, May 2018
It won’t come as a major surprise to hear that the edible oil freight markets are materially the same was they were last month and hindsight is the only exact science we can offer you at the moment on where these crazy markets are heading! The liquid oil markets are painfully slow in the Western Hemisphere and the tropical oil markets East of Suez have been very stop-start this month. The East and Western CPP markets are charting in a completely opposite direction to one another as the Atlantic basket, which had dipped to as low as 5,700 per day a month ago is now averaging US$ 11,175 per day and in the Far East, the Pacific basket is now averaging US$ 8,000 per day compared with US$ 12,000 a month ago.
Crude oil hit its highest price level in three and a half years on the 18th of April due to a supply squeeze and it has continued to edge higher ever since and some forecasters believe that crude values could possibly rise by another 15 % this year. Whilst we know from past experience that this doesn’t always influence spot freight rates in the short term, as it takes a basket of other factors to do that, however, we think it is only a matter of time before it does.