Malaysia CPKO: Offers slip further as supply expected to see uptick
Local CPKO offers in Malaysia dipped further in the week ending May 24, as expectations of better supply and movements in related vegoils kept pressure on prices.
Weekly average offers fell marginally by 2 ringgit to 289 ringgit per picul, with offer levels ranging 287-290 ringgit per picul during the week. Overall prices were relatively rangebound, with demand remaining steady amid talks that Malaysian palm production in May could see stronger-than-anticipated growth from April. Malaysia’s CPKO exports for the period May 1-25 were estimated at 19,650 tonnes, marginally changed from the 19,275 tonnes shipped in the same period one month ago and 2,000 tonnes more compared to May 1-20 according to cargo surveyor Intertek Testing Services (ITS), with the in-crease stemming from higher exports to the EU.
PPKO exports were estimated at 25,835 tonnes, slightly higher than the 24,650 tonnes shipped in April 1-25. (1 tonne = 16.5346 picul).
CPKO cif Rotterdam: Offers move up with trades done for Aug-Sep
CPKO offers to Rotterdam rose in the week ending May 24 for cargoes loading in May-June and for forward months, with levels across shipment months converging around $1,170 per tonne. Trades were heard done for cargoes loading in August-September at $1,140-1,150 per tonne with offer levels $5 per tonne higher from the previous week at $1,175 per tonne.
The spread against rival CCNO also narrowed by $22 per tonne from last week to $212 per tonne with average CCNO CIF Rotterdam offers for May-June shipment cargoes sliding by $14 per tonne. Regardless the spread remains considerably wider compared to around a year ago where CCNO was offered at just $77 per tonne on average higher than CPKO, and a month ago where the spread was $177 per tonne, thus keeping CPKO well-priced against its rival to support demand. CPKO exports from Malaysia to the EU were estimated at 2,760 tonnes during May 1-25 according to figures from cargo surveyor ITS, up from 760 tonnes in May 1-20 and a sharp drop from the 12,375 tonnes exported in April 1-25, with the entire volume headed to the Netherlands. The drop likely stems from slower buying for May-cargoes due to higher prices, with offers for April-May/May-June shipment cargoes seen touching a recent high of $1,310 per tonne CIF Rotterdam and $1,290 per tonne CIF Rotterdam in early-April.
CCNO: Offers descend slipping below the support price
Rotterdam market offers descended across the delivery months except for the front month May-Jun which was unchanged. Overall offers were $25-35 below the $1400 per tonne support level established two weeks ago. There were no trades heard for the twelfth week in a row. In general CCNO weekly average offers fell by $14 to land at $1393 per tonne, the lowest in three weeks with little signal on price recovery supported by demand. On Friday the asking price was at $1375 per-tonne, the lowest in two weeks. CCNO offers are currently $65 lower than the peak of $1440 per-tonne achieved this year on 16 April but $265 or 24% higher than the start of the year of $1110 per-tonne. CCNO offers been largely supported by the higher substitute product of CPKO following recovery in demand particularly to China and the E.U from the oleochemicals sector. CPKO prices are up by $150 or 15% from the start of this year. In the origin market, CCNO fob Philippines were ask-ing between $1120-1130 per tonne or $1124 per tonne weekly average, unchanged from last week from absence of fob buying activity. The Philippines CCNO offers been on a sliding trend since testing the high of $1250 per tonne in the first week of April. Prices have now contracted by $120 or 10% from the peak amidst poor buying demand.
Source: POA