Stearin stocks fall to the lowest in 3 months
RBD palm olein offers stayed below stearin for 10 successive days ending Fri 10 May. Olein offers were below stearin by $25.50 week-on-week average widening from $15 in the week prior. Stearin offers averaged $884.50 per tonne while one was $859 per tonne. Palm olein generally trades $15 to 60 premium stearin but the spread been narrowing since April and flipped to a discount from 26 Apr. Stearin which is a by-product from fractionation of RBD palm oil is produced in a smaller quantity i.e. about 25% of the volume while the main product RBD palm olein make up the bulk of the volume of near 70%. Stearin exports for the first 10 days of May dipped 4.7% from a month earlier, in line with an overall decline of 14% in Malaysian palm oil exports, according to ITS data. Stearin exports to Africa more than doubled on higher exports to Kenya and Mozambique but failed to offset the declines to South Korea (-58%) and South Africa (35%). Meanwhile, co-product RBD palm olein exports fell sharply, down by 54% compared to the same period a month earlier. This was driven by losses to India which saw zero volume shipped compared with 26,500 tonnes in April and a 77% drop in exports to Chi-na. End-month Apr palm stearin stocks at refineries in Malaysia totalled 115,075 tonnes—the lowest since Jan and 12% lower than the prior month—MPOB data, underlying the tight supply fundamentals that is reflected in firm pricing.
(Courtesy: POA, Singapore)